The Federal Housing Finance Agency (FHFA) issues this final regulation revising its existing Freedom of Information Act (FOIA) regulation. This final regulation provides procedures and guidelines under which FHFA and the FHFA Office of Inspector General (FHFA-OIG) will implement FOIA.

DATES:

The final regulation is effective January 31, 2012.

FOR FURTHER INFORMATION CONTACT:

David A. Lee, FHFA Chief FOIA Officer, (202) 649-3058,david.lee@fhfa.gov(not a toll-free number), Federal Housing Finance Agency, 400 Seventh Street SW., Eighth Floor, Washington, DC 20024.Please note that all mail sent to FHFA via the United States Postal Service is routed through a national irradiation facility, a process that may delay delivery by approximately two weeks. For any time-sensitive correspondence, please plan accordingly.The telephone number for the Telecommunications Device for the Hearing Impaired (TDD) is (800) 877-8339.

SUPPLEMENTARY INFORMATION:I. Interim Final Regulation

FHFA issued an interim final regulation on May 23, 2011 at 76 FR 29633 revising its 2009 FOIA regulation in various aspects. These revisions were necessary to provide procedures and guidelines under which FHFA and FHFA-OIG would implement FOIA, as well as to implement certain necessary updates and revisions to the 2009 regulation. FHFA solicited public comments on the interim final regulation for a 60-day period that ended on July 22, 2011.

II. Analysis of Comment Received and Final Regulation

FHFA received one comment letter in response to the interim final regulation from the National Archives and Records Administration's Office of Government Information Services (NARA). NARA recommended several changes to the interim final regulation. These changes are discussed below. Additionally, since the publication of the interim final regulation, FHFA has relocated its headquarters and its mailing address and contact information for the FOIA program has changed. As a result, FHFA will also be making technical changes to the regulation to include the new mailing address and telephone, and facsimile numbers for the FOIA program.

Section 1202.1—Why did FHFA issue this regulation?

NARA suggested revising § 1202.1(c) to clarify how FHFA and FHFA-OIG will handle first-party access requests—i.e.,a request for information about yourself—which are commonly submitted pursuant to the Privacy Act. FHFA and FHFA-OIG agree with this recommendation and have revised the final regulation to clarify how first-party access requests will be handled.

Section 1202.2—What do the terms in this regulation mean?

NARA suggested adding definitions for the terms “FOIA Liaison,” “Fee Waiver,” and “Requester Category.” FHFA has revised the regulation to include definitions for the terms “FOIA Liaison” and “Fee Waiver.” As for NARA's recommendation regarding the term “Requester Category,” FHFA and FHFA-OIG have incorporated three different categories into the definition of “Requester in the final regulation.” Therefore, a separate, stand-alone definition of “Requester Category” is unnecessary and has not been adopted in the final regulation.

NARA also suggested that clarifying language be added to the definition of “Direct Costs,” at least to the extent that such costs may relate to contract services costs. Since neither FHFA nor FHFA-OIG uses or contemplates using contract services to fulfill FOIA responsibilities, the term's current definition is sufficiently descriptive and no further clarification is necessary, and none has been adopted in the final regulation.

NARA further suggested that the definition of “Unusual Circumstances” be revised to “differentiate between FHFA's 12 Federal Home Loan Banks (FHLBanks) located across the country and an office that is on another floor or a few blocks away.” This comment suggests that the FHLBanks are units of FHFA. FHLBanks are not units of FHFA. FHFA regulates the FHLBanks, which are wholly private entities and therefore not subject to FOIA. Any reference in this final regulation to “other components” of FHFA or FHFA-OIG refers to offices within FHFA or FHFA-OIG, not to the FHLBanks. As a result, such a revision is unnecessary and has not been adopted in the final regulation.

Section 1202.3—What information can I obtain through FOIA?

NARA recommended that § 1202.3(b) be revised to expand the universe of information a requester may obtain to include compilations of information contained in databases, “especially if a compilation can be produced through a few keystrokes.” FHFA and FHFA-OIG decline to make this change. NARA's recommendation would require proactive disclosure of anything that might be produced electronically while imposing an undue burden, regardless of whether the requester sought it. However, if a requester seeks a compilation of information contained in databases, he or she may ask for it. This position is consistent with FOIA and with applicable case precedent. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification. FHFA, however, will be making technical changes to this section to update the contact information of the FOIA program to that of FHFA's new headquarters.

Section 1202.4—What information is exempt from disclosure?

NARA recommended that § 1202.4(d), which specifically concerns “[e]xempt and redacted material,” be revised to make plain that no itemized index of withheld materials needs to be provided to a requester “at the administrativestage of processing a request.” The current language of paragraph (d) complies with applicable statutory and precedential requirements for FOIA. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

Section 1202.5—How do I request information from FHFA or FHFA-OIG under FOIA?

NARA suggested that § 1202.5(c) through (g) be revised to indicate not that requesters “must” comply with the procedural requirements set forth therein, but that they merely “should” do so. FHFA and FHFA-OIG decline to adopt this recommendation. Establishing clear requirements minimizes ambiguity in processing and handling FOIA requests, and helps ensure that all requesters are treated equally. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

NARA also suggested that § 1202.5(d) be revised to indicate that requesters should attempt to identify their fee status, but not absolutely require that they do so. FHFA and FHFA-OIG agree and have made the suggested modification.

Additionally, FHFA will be making technical changes to this section to update the contact information of the FOIA program to that of FHFA's new headquarters.

Section 1202.7—How will FHFA and FHFA-OIG respond to my FOIA request?

In the interim final regulation, § 1202.7(c), Referrals to other agencies, provided that FHFA and FHFA-OIG refer requests that seek records originating in other agencies to that agency. It also provided that the requester be notified when such referrals occur. NARA recommended that § 1202.7(c) be revised to provide that FHFA and FHFA-OIG also notify requesters of what part of the request was referred, the name of the agency to which the request was referred, as well as the name of a contact at that agency to whom the requester may speak about the referred request. As a matter of procedure, FHFA provides this information to requesters but will include that procedure expressly in § 1202.7(c).

NARA also recommended that § 1202.7(d) be revised to designate the “search cut-off date”—i.e.,the date of the request—as the date of search, on the presumption that such a designation could “result in a much fuller search.” As a matter of policy, however, FHFA and FHFA-OIG consistently use the date on which each request is received as the date of search. Further, it is not evident that the recommended change would necessarily result in a “fuller” search. FHFA and FHFA-OIG elect to use their discretion on this point, and thereby decline to adopt NARA's suggested modification.

Section 1202.9—How do I appeal a response denying my FOIA request?

NARA suggested that § 1202.9(b) be revised to extend a requester's deadline for appealing the agency response on a given request from 30 days to 45 or even 60 days. FOIA requires only a 30-day appeal window and FHFA and FHFA-OIG decline to extend it further.

NARA also suggested that § 1202.9 be amended by adding a new paragraph (g), which would require that requesters be advised of the services offered by NARA's Office of Government Information Services (OGIS) services, and further informing the requester that FHFA and FHFA-OIG will work with OGIS to resolve disputes concerning responses to FOIA requests. Section 1202.9 of the final regulation has been amended to include a new paragraph (g), which advises requesters that they may consult the OGIS regarding disputes. However, current law does not require that such disputes be referred to the OGIS, which offers mediation services, but possesses no binding authority over either FHFA or FHFA-OIG with regard to information production or any other matter. NARA's additional suggestions would commit FHFA and FHFA-OIG to take steps beyond those required by law that would unduly burden this process. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

Additionally, FHFA will be making technical changes to this section to update the contact information of the FOIA program to that of FHFA's new headquarters.

Section 1202.11—What will it cost to get the records I requested?

NARA recommended that § 1202.11(a) be revised to provide requesters with a breakdown of all fees applicable to the FOIA process. This change is unnecessary, because paragraph (c) of this section directs requesters to FHFA's Web site for the most current fee schedule, to which FHFA-OIG also abides. Referring requesters to the Web site eliminates the need to update formally the regulation every time a fee changes. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

NARA also recommended that § 1202.11(b) be modified to provide information on how FHFA would determine the electronic equivalent of 100 pages of duplication, for the purpose of assessing an applicable fee. FHFA and FHFA-OIG decline to confine themselves to any one method for making such a determination, since the nature and format of the responsive material will necessarily dictate how best to ascertain that material's relative “page length.” Further, methods for making this determination are likely to change as technology develops, making a regulatory commitment to follow one method over another inadvisable. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

NARA further recommended that § 1202.11(h) be revised to permit fee waivers “as a matter of administrative discretion.” FHFA and FHFA-OIG decline to revise the existing language, which tracks the statutory and legal requirements of FOIA and provides for the even-handed treatment of all requesters. Therefore, FHFA and FHFA-OIG decline to adopt NARA's suggested modification.

Regulatory ImpactsPaperwork Reduction Act

The regulations in this part do not contain any information collection requirement that requires the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. 3501et seq.).

Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601et seq.) requires that a regulation that has a significant economic impact on a substantial number of small entities, small businesses, or small organizations must include an initial regulatory flexibility analysis describing the regulation's impact on small entities. Such an analysis need not be undertaken if the agency has certified that the regulation does not have a significant economic impact on a substantial number of small entities (5 U.S.C. 605(b)). FHFA has considered the impact of the regulation under the Regulatory Flexibility Act. FHFA certifies that the regulation is not likely to have a significant economic impact on a substantial number of small business entities because the regulation is applicable only to the internal operations and legal obligations of FHFA and FHFA-OIG.

Accordingly for the reasons stated in the preamble, the interim final regulation amending 12 CFR part 1202 that was published in theFederal Registerat 76 FR 29633 on May 23, 2011 is adopted as a final regulation with the following changes:

PART 1202—FREEDOM OF INFORMATION ACT1. The authority citation for part 1202 continues to read as follows:Authority:

(c) If you want to request information about yourself, this is considered a first-party or Privacy Act request under the Privacy Act (5 U.S.C. 552a), and therefore you should file your request using FHFA's Privacy Act regulations at part 1204 of this title. If you file a request for information about yourself, FHFA or FHFA-OIG will process this request under both FOIA and Privacy Act in order to give you the greatest degree of access to any responsive material.

3. Amend § 1202.2 as follows:a. Add definitions for the terms “Fee Waiver” and “FOIA Public Liaison” in alphabetical order; andb. Revise the definition for the term “Requester”.

The additions and revisions read as follows:

§ 1202.2What do the terms in this regulation mean?

Fee Waivermeans the waiver or reduction of fees if the requester can demonstrate that certain statutory standards are met.

FOIA Public Liaisonis a person who is responsible for assisting requesters with their requests.

Requestermeans any person seeking access to FHFA or FHFA-OIG records under FOIA. A requester falls into one of three categories for the purpose of determining what fees may be charged. The three categories are—

(1) Commercial;

(2) News media, scientific institution or educational; and

(3) Other.

§ 1202.3—[Amended]4. Amend § 1202.3(c)(1) as follows:a. Remove the words “1700 G Street, NW., Fourth Floor, Washington, DC 20552” and add in their place the words “400 Seventh Street, SW., Eighth Floor, Washington, DC 20024”.b. Remove the words “1625 Eye Street, NW., Washington, DC 20006” and add in their place the words “400 Seventh Street, SW., Third Floor, Washington, DC 20024”.c. Remove the telephone number “(202) 414-6425” and add in its place the telephone number “(202) 649-3803”.d. Remove the telephone number “(202) 408-2577” and remove the email address “bryan.saddler@fhfa.gov” and add in their place the telephone number “(202) 730-2824” and the email address “bryan.saddler@fhfaoig.gov”.5. Amend § 1202.5 as follows:a. In paragraph (a) remove the words “1700 G Street, NW., Washington, DC 20552” and remove the facsimile number “(202) 414-8917” and add in their place the words “400 Seventh Street, SW., Eighth Floor, Washington, DC 20024” and the facsimile number “(202) 649-1073”.b. Revise paragraph (d) to read as follows:§ 1202.5How do I request information from FHFA or FHFA-OIG under FOIA?

(d)Your FOIA status.If you are submitting your request as a “commercial use” requester, an “educational institution” requester, a “non-commercial scientific institution” requester, or a “representative of the news media” for the purposes of the fee provisions of FOIA, your request should include a statement specifically identifying your status.

(c)Referrals to other agencies.If you submit a FOIA request that seeks records originating in another Federal Government agency, FHFA or FHFA-OIG will refer your request or a portion of your request, as applicable, to the other agency for response. FHFA or FHFA-OIG will provide you notice of the referral, what portion of the request was referred, and the name of the other agency and contact information.

(g)Additional Resource.The National Archives and Records Administration (NARA), Office of Government Information Services (OGIS) offers non-compulsory, non-binding mediation services to resolve FOIA disputes. If you seek information regarding the OGIS and/or the services it offers, please contact the OGIS directly at Office of Government Information Services, National Archives and Records Administration, Room 2510, 8601 Adelphi Road, College Park, MD 20740-6001, Email:ogis@nara.gov, Phone: (301) 837-1996, Fax: (301) 837-0348, Toll-free: 1-(877) 684-6448. This information is provided as a public service only. By providing this information, FHFA and FHFA-OIG do not commit to refer disputes to OGIS, or to defer to OGIS' mediation decisions in particular cases.

The Federal Housing Finance Agency (FHFA) is adopting as a finalregulation the interim final regulation that revised FHFA's implementing regulation under the Privacy Act of 1974 (Privacy Act). The changes to the existing Privacy Act regulation provide the procedures and guidelines under which FHFA and the FHFA Office of Inspector General (FHFA-OIG) will implement the Privacy Act of 1974, as amended (5 U.S.C. 552a).

DATES:

The final regulation is effective January 31, 2012.

FOR FURTHER INFORMATION CONTACT:

Stacy J. Easter, Privacy Act Officer, (202) 649-3067,stacy.easter@fhfa.gov, or David A. Lee, Senior Agency Official for Privacy, (202) 649-3058,david.lee@fhfa.gov(not toll-free numbers), Federal Housing Finance Agency, 400 Seventh Street, SW., Eighth Floor, Washington, DC 20024.Please note that all mail sent to FHFA via the United States Postal Service is routed through a national irradiation facility, a process that may delay delivery by approximately two weeks. For any time-sensitive correspondence, please plan accordingly.The telephone number for the Telecommunications Device for the Deaf is (800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

In August 2011, FHFA published an interim final regulation with request for comments that revised its Privacy Act regulation.See76 FR 51869 (Aug. 19, 2011). The revised Privacy Act regulation (12 CFR part 1204) provided the procedures and guidelines under which FHFA and FHFA-OIG will implement the Privacy Act. The 60-day public comment period for the interim final regulation closed on October 18, 2011.See76 FR 51869.

II. Analysis of Public Comments and the Final Regulation

FHFA received no comments in response to the interim final regulation. Thus, for the reasons set forth in detail in the interim final regulation, FHFA is adopting the interim final regulation as a final regulation without any substantive changes. However, since the publication of the interim final regulation, FHFA has relocated its headquarters and its mailing address and contact information for the Privacy program has changed. As a result, FHFA will be making only technical changes to the regulation to include the new mailing address and facsimile numbers for the Privacy program.

III. Paperwork Reduction Act

The final regulation does not contain any information collection requirement that requires the approval of OMB under the Paperwork Reduction Act (44 U.S.C. 3501et seq.).

IV. Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601et seq.) requires that a regulation that has a significant economic impact on a substantial number of small entities, small businesses, or small organizations include an initial regulatory flexibility analysis describing the regulation's impact on small entities. Such an analysis need not be undertaken if the agency has certified that the regulation does not have a significant economic impact on a substantial number of small entities. 5 U.S.C. 605(b). FHFA has considered the impact of the final regulation under the Regulatory Flexibility Act. FHFA certifies that the regulation is not likely to have a significant economic impact on a substantial number of small business entities because the regulation is applicable to the internal operations and legal obligations of FHFA and FHFA-OIG.

For the reasons stated in the preamble, the interim final regulation amending 12 CFR part 1204 that was published in theFederal Registerat 76 FR 51869 on August 19, 2011, is adopted as a final regulation with the following technical changes:

PART 1204—PRIVACY ACT IMPLEMENTATION1. The authority citation for part 1204 continues to read as follows:Authority:

We are adopting a new airworthiness directive (AD) for certain Bombardier, Inc. Model DHC-8-400, -401, and -402 airplanes. This AD requires an inspection of a certain alternating current (AC) power wire bundle for damage, and repair if necessary. Additionally, this AD requires segregating the wire bundle into two wire bundles and installing Teflon tubing. This AD was prompted by multiple reports of the loss of certain AC systems caused by a burnt AC power wire bundle. We are issuing this AD to prevent the loss of ice protection systems for the angle of attack vanes, pitot probes, engine inlets, and windshields, and consequent loss of or misleading airspeed indication and increased workload for the flight crew, which could lead to loss of control of the airplane.

DATES:

This AD becomes effective February 15, 2012.

The Director of the Federal Register approved the incorporation by reference of a certain publication listed in the AD as of February 15, 2012.

You may examine the AD docket on the Internet athttp://www.regulations.gov;or in person at the Docket Operations office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone (800) 647-5527) is in theADDRESSESsection. Comments will be available in the AD docket shortly after receipt.

Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada, has issued Canadian Airworthiness Directive CF-2011-46, dated December 20, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

There have been several reports of the loss of certain Alternating Current (AC) systems along with the tripping of associated circuit breakers. During maintenance troubleshooting, the same AC power wire bundle was found burnt. All AC systems and AC Generators could be affected by damage to this AC power wire bundle resulting in the loss of ice protection systems for the angle of attack vanes, pitot probes, engine inlets or windshields. In icing conditions, the loss of the ice protection systems could affect continued safe flight.

This [TCCA] Airworthiness Directive (AD) mandates the detailed inspection [for damage] of the AC power wire bundle [and repair if necessary] and segregation of the wires within the affected AC power wire bundle to prevent a dual system loss [and installing Teflon tubing].

The detailed inspection for damage includes inspecting for any foreign object damage (FOD), damage due to sharp bends and kinking or deterioration, insulation cracking, evidence of heat damage to the insulation, and chafing. The unsafe condition is the loss of ice protection systems for the angle of attack vanes, pitot probes, engine inlets, and windshields, and consequent loss of or misleading airspeed indication and increased workload for the flight crew, which could lead to loss of control of the airplane. You may obtain further information by examining the MCAI in the AD docket.Relevant Service Information

Bombardier has issued Service Bulletin 84-24-52, dated November 22, 2011. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

Differences Between the AD and the MCAI

Although the MCAI recommends accomplishing the actions within 600 flight hours or 90 days, whichever occurs first, after the effective date of the MCAI, this AD requires accomplishment within 400 flight hours or 60 days, whichever occurs first, after the effective date of this AD. We find that a compliance time of 600 flight hours or 90 days, whichever occurs first, would not address the unsafe condition soon enough to maintain an adequate level of safety for the affected fleet. In developing an appropriate compliance time for this AD, we considered the degree of urgency associated with addressing the unsafe condition, the upcoming inclement weather conditions, and the maximum interval of time allowable for all affected airplanes to continue to operate without compromising safety. We find that 400 flight hours or 60 days, whichever occurs first, after the effective date of this AD, to be an appropriate compliance time to complete these actions. This difference has been coordinated with TCCA.

FAA's Determination and Requirements of This AD

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are issuing this AD because we evaluated all pertinent information and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design.

FAA's Determination of the Effective Date

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because there have been several reports of the loss of certain AC systems along with the tripping of associated circuit breakers. During maintenance troubleshooting, the same AC power wire bundle was found burnt. All AC systems and AC Generators could be affected by damage to this AC power wire bundle resulting in the loss of ice protection systems for the angle of attack vanes, pitot probes, engine inlets or windshields. In icing conditions, the loss of the ice protection systems could affect continued safe flight. Therefore, we determined that notice and opportunity for public comment before issuing this AD are impracticable and that good cause exists for making this amendment effective in fewer than 30 days.

Comments Invited

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under theADDRESSESsection. Include “Docket No. FAA-2012-0037; Directorate Identifier 2012-NM-003-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

We will post all comments we receive, without change, tohttp://www.regulations.gov,including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this AD.

Authority for This Rulemaking

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. “Subtitle VII: Aviation Programs,” describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in “Subtitle VII, Part A, Subpart III, Section 44701: General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary forsafety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

Regulatory Findings

We determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify this proposed regulation:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979);

3. Will not affect intrastate aviation in Alaska; and

4. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a regulatory evaluation of the estimated costs to comply with this AD and placed it in the AD docket.

This AD was prompted by multiple reports of the loss of certain alternating current (AC) systems caused by a burnt AC power wire bundle. We are issuing this AD to prevent the loss of ice protection systems for the angle of attack vanes, pitot probes, engine inlets, and windshields, and consequent loss of or misleading airspeed indication and increased workload for the flight crew, which could lead to loss of control of the airplane.

(f) Compliance

You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done.

(g) Inspection and Corrective Actions

Within 400 flight hours or 60 days, whichever occurs first, after the effective date of this AD, do the actions specified in paragraphs (g)(1) and (g)(2) of this AD.

(1) Do a detailed inspection of the affected AC power wire bundle for damage (any foreign object damage (FOD), damage due to sharp bends and kinking or deterioration, insulation cracking, evidence of heat damage to the insulation, and chafing) and do all applicable repairs, in accordance with the Accomplishment Instructions of Bombardier Service Bulletin 84-24-52, dated November 22, 2011. Do all applicable repairs before further flight.

(2) Segregate the AC power wire bundle into two bundles and install Teflon tubing, in accordance with the Accomplishment Instructions of Bombardier Service Bulletin 84-24-52, dated November 22, 2011.

(h) Other FAA AD Provisions

The following provisions also apply to this AD:

(1)Alternative Methods of Compliance (AMOCs):The Manager, New York Aircraft Certification Office (ACO), ANE-170, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the ACO, send it to Attn: Program Manager, Continuing Operational Safety, FAA, New York ACO, 1600 Stewart Avenue, Suite 410, Westbury, New York 11590; telephone (516) 228-7300; fax (516) 794-5531. Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office. The AMOC approval letter must specifically reference this AD.

(2)Airworthy Product:For any requirement in this AD to obtain corrective actions from a manufacturer or other source, use these actions if they are FAA-approved. Corrective actions are considered FAA-approved if they are approved by the State of Design Authority (or their delegated agent). You are required to assure the product is airworthy before it is returned to service.

(i) Related Information

Refer to MCAI Canadian Airworthiness Directive CF-2011-46, dated December 20, 2011; and Bombardier Service Bulletin 84-24-52, dated November 22, 2011; for related information.

(j) Material Incorporated by Reference

(1) You must use the following service information to do the actions required by this AD, unless the AD specifies otherwise. The Director of the Federal Register approved the incorporation by reference (IBR) of the following service information under 5 U.S.C. 552(a) and 1 CFR part 51:

(3) You may review copies of the service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, Washington. For information on the availability of this material at the FAA, call (425) 227-1221.

(4) You may also review copies of the service information that is incorporated by reference at the National Archives and Records Administration (NARA). For information on the availability of this material at an NARA facility, call (202) 741-6030, or go tohttp://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.

We are superseding an existing airworthiness directive (AD) forall RR RB211-535E4-37, -535E4-B-37, -535E4-B-75, and -535E4-C-37 turbofan engines. That AD currently requires performing initial and repetitive visual and fluorescent penetrant inspections (FPI) of the low-pressure (LP) turbine stage 1, 2, and 3 discs to detect cracks in the discs. This new AD continues to require those inspections and changes the definition of a shop visit to be less restrictive. This AD was prompted by our finding that the definition of shop visit in the existing AD was too restrictive. We are issuing this AD to revise the definition of shop visit and to detect cracks in the LP turbine stage 1, 2, and 3 discs, which could result in an uncontained release of LP turbine blades and damage to the airplane.

You may examine the AD docket on the Internet athttp://www.regulations.gov;or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: (800) 647-5527) is Document Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2011-11-08, amendment 39-16707 (76 FR 30529, May 26, 2011). That AD applies to the specified products. The NPRM was published in theFederal Registeron October 25, 2011 (76 FR 65997). That NPRM proposed to continue to require performing an initial FPI on the LP turbine stage 1, 2, and 3 discs at the next engine shop inspection after the effective date of that AD. That NPRM also continued to require repetitive inspections at each engine shop visit after accumulating 1,500 cycles since last inspection of the LP turbine stage 1, 2, and 3 discs. That NPRM also proposed to change the definition of a shop visit to be less restrictive.

Comments

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM (76 FR 65997, October 25, 2011) or on the determination of the cost to the public.

Conclusion

We reviewed the relevant data and determined that air safety and the public interest require adopting the AD as proposed.

Costs of Compliance

We estimate that this AD affects about 588 RB211-535 series turbofan engines installed on airplanes of U.S. registry. We also estimate that it will take about 30 work-hours per product to comply with this AD. The average labor rate is $85 per work-hour. No parts are required. Based on these figures, we estimate the cost of this AD on U.S. operators to be $1,499,400.

Authority for This Rulemaking

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

Regulatory Findings

We have determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866,

(2) Is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979),

(3) Will not affect intrastate aviation in Alaska, and

(4) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

This AD was prompted by our determination that the definition of “shop visit” in the existing AD is too restrictive, inthat it would require operators to inspect more often than required to ensure safety. We are issuing this AD to revise the definition of shop visit and to detect cracks in the low-pressure (LP) turbine stage 1, 2, and 3 discs, which could result in an uncontained release of LP turbine blades and damage to the airplane.

(e) Compliance

Comply with this AD within the compliance times specified, unless already done.

(1) Initial Inspection Requirements

At the next engine shop visit after the effective date of this AD, perform a visual and a fluorescent penetrant inspection of the LP turbine stage 1, 2, and 3 discs.

(2) Repeat Inspection Requirements

At each engine shop visit after accumulating 1,500 cycles since the last inspection of the LP turbine stage 1, 2 and 3 discs, repeat the inspections specified in paragraph (e)(1) of this AD.

(3) Remove Cracked Discs

If you find cracks, remove the disc from service.

(f) Definitions

For the purpose of this AD, an “engine shop visit” is induction of an engine into the shop for any purpose where:

(1) All the blades are removed from the high-pressure (HP) compressor discs and the HP turbine disc, or

(2) All the blades are removed from the intermediate pressure turbine disc.

(g) Alternative Methods of Compliance (AMOCs)

The Manager, Engine Certification Office, FAA may approve AMOCs for this AD. Use the procedures found in 14 CFR 39.19 to make your request.

We are superseding two existing airworthiness directives (ADs) for General Electric Company (GE) CF6-45 and CF6-50 series turbofan engines with certain low-pressure turbine (LPT) rotor stage 3 disks installed. The existing ADs currently require inspections of high-pressure turbine (HPT) and LPT rotors, engine checks, and vibration surveys. This new AD retains the requirements of the two ADs being superseded, adds an optional LPT rotor stage 3 disk removal after a failed HPT blade borescope inspection (BSI) or a failed engine core vibration survey, establishes a new lower life limit for the affected LPT rotor stage 3 disks, and requires removing these disks from service at times determined by a drawdown plan. This AD was prompted by the determination that a new lower life limit for the LPT rotor stage 3 disks is necessary. We are issuing this AD to prevent critical life-limited rotating engine part failure, which could result in an uncontained engine failure and damage to the airplane.

DATES:

This AD is effective March 6, 2012.

The Director of the Federal Register approved the incorporation by reference of a certain publication listed in this AD as of February 22, 2011 (76 FR 6323, February 4, 2011).

ADDRESSES:

For service information identified in this AD, contact General Electric Company, GE-Aviation, Room 285, 1 Neumann Way, Cincinnati, OH 45215, phone: (513) 552-3272; email:geae.aoc@ge.com.You may review copies of the referenced service information at the FAA, Engine & Propeller Directorate, 12 New England Executive Park, Burlington, MA. For information on the availability of this material at the FAA, call (781) 238-7125.

Examining the AD Docket

You may examine the AD docket on the Internet athttp://www.regulations.gov;or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: (800) 647-5527) is Document Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2011-02-07, Amendment 39-16580 (76 FR 6323, February 4, 2011) and AD 2011-18-01, Amendment 39-16783 (76 FR 52213, August 22, 2011). Those ADs apply to the specified products. The NPRM published in theFederal Registeron October 19, 2011 (76 FR 64844). That NPRM proposed to retain the requirements of AD 2011-02-07 and AD 2011-18-01, except that reporting to the FAA would no longer be required and there would be an optional LPT rotor stage 3 disk removal after a failed HPT blade BSI or a failed engine core vibration survey. That NPRM also proposed to establish a new lower life limit for the LPT rotor stage 3 disk part numbers listed in Table 1 of the proposed AD, and proposed to require removing these disks from service at times determined by a drawdown plan.

Comments

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the proposal and the FAA's response to each comment.

Support for the NPRM as Written

One commenter, The Boeing Company, supports the NPRM (76 FR 64844, October 19, 2011) as written.

Request To Allow Credit for Vibration Surveys Performed in a Test Cell

One commenter, MTU Maintenance Hannover GmbH, requested that we add a paragraph that allows credit for performing vibration surveys in a test cell, as meeting the AD vibration survey requirements.

We agree. We added paragraph (k)(8) to the AD, which states “Vibration surveys carried out in an engine test cell as part of an engine manual performance run fulfill the vibration survey requirements of paragraphs (k)(2) through (k)(3) of this AD.”

One commenter, Evergreen International Airlines, requested that we add a requirement that two consecutive raw EGT trend data point exceedances must be confirmed by a corresponding shift of other engine parameters to trigger the HPT blade BSI.

We partially agree. We agree that EGT system error should not force a BSI of turbine blades. But we disagree with troubleshooting the EGT raw data points once the EGT system error was ruled out. We added paragraph (o)(4) to the AD to state that, for the purposes of this AD, a raw EGT trend data point above the smoothed average is a confirmed temperature reading over the rolling average of EGT readings that is not a result of EGT system error. We also rearranged the wording in paragraph (iv) in Table 2 of the AD for clarification.

Correction to Engine Model CF6-50-E2D

Since we issued the NPRM (76 FR 67844, October 19, 2011), we discovered that, in applicability paragraph (c), engine model CF6-50-E2D was incorrect. We corrected it to read CF6-50E2B in the AD.

Conclusion

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting the AD with the changes described previously. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (76 FR 64844, October 19, 2011) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM.

We also determined that these changes will not increase the economic burden on any operator or increase the scope of the AD.

Costs of Compliance

We estimate that this AD will affect 387 CF6-45 and CF6-50 series turbofan engines installed on airplanes of U.S. registry. We also estimate that it will take about 8 work-hours to perform the HPT blade inspection, 6 work-hours to perform a vibration survey, 4 work-hours to perform an ultrasonic inspection, 2 work-hours to perform an EGT resistance check, 1 work-hour to perform an EGT thermocouple inspection, and 7 work-hours to clean and perform an fluorescent-penetrant inspection of the LPT rotor stage 3 disk for each engine. The average labor rate is $85 per work-hour. The cost estimate for the work just described was covered in the two ADs we are superseding. For this AD, we estimate that a replacement LPT rotor stage 3 disk prorated part cost is $75,000. Based on these figures, we estimate the total cost of this AD to U.S. operators to be $29,025,000.

Authority for This Rulemaking

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

Regulatory Findings

We have determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866,

(2) Is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979),

(3) Will not affect intrastate aviation in Alaska, and

(4) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

This AD was prompted by the determination that a new lower life limit for the LPT rotor stage 3 disks listed in Table 1 of this AD is necessary. We are issuing this AD to prevent critical life-limited rotating engine part failure, which could result in an uncontained engine failure and damage to the airplane.

(e) Compliance

Comply with this AD within the compliance times specified, unless already done.

For the BSIs required by paragraphs (f)(1), (f)(2), and (f)(3) of this AD, inspect the blades from the forward and aft directions. Inspect all areas of the blade airfoil. Your inspection must include blade leading and trailing edges and their convex and concave airfoil surfaces. Inspect for signs of impact, cracking, burning, damage, or distress.

(1) Perform an initial BSI of the HPT rotor stage 1 and stage 2 blades within 10 cycles after the effective date of this AD.

(2) Thereafter, repeat the BSI of the HPT rotor stage 1 and stage 2 blades within every 75 cycles since last inspection (CSLI).

(3) Borescope-inspect the HPT rotor stage 1 and stage 2 blades within the cycle limits after the engine has experienced any of the events specified in Table 2 of this AD.

(4) Remove any engine from service before further flight if the engine fails any of the BSIs required by this AD.

(1) Inspect the EGT thermocouple probe for damage within 50 cycles after the effective date of this AD or before accumulating 750 CSLI, whichever occurs later.

(2) Thereafter, re-inspect the EGT thermocouple probe for damage within every 750 CSLI.

(3) If any EGT thermocouple probe shows wear through the thermocouple guide sleeve, remove and replace the EGT thermocouple probe before further flight, and ensure the turbine mid-frame liner does not contact the EGT thermocouple probe.

(i) EGT System Resistance Check Inspections

(1) Perform an EGT system resistance check within 50 cycles from the effective date of this AD or before accumulating 750 cycles since the last resistance check on the EGT system, whichever occurs later.

(2) Thereafter, repeat the EGT system resistance check within every 750 cycles since the last resistance check.

(3) Remove and replace, or repair any EGT system component that fails the resistance system check before further flight.

Within 75 cycles after the effective date of this AD, perform a UI of the forward spacer arm of the LPT rotor stage 3 disk. Use Appendix A of GE Service Bulletin (SB) No. CF6-50 S/B 72-1312, Revision 1, dated October 18, 2010, paragraph 4. except for paragraph 4.(12), to do the UI.

(k) Engine Core Vibration Survey

(1) Within 75 cycles after the effective date of this AD, perform an initial engine core vibration survey.

(2) Use about a one-minute acceleration and a one-minute deceleration of the engine between ground idle and 84% N2 (about 8,250 rpm) to perform the engine core vibration survey.

(3) Use a spectral/trim balance analyzer or equivalent to measure the N2 rotor vibration.

(4) If the vibration level is above 5 mils Double Amplitude then, before further flight, remove the engine from service.

(5) For those engines that fail any engine core vibration survey requirements of this AD, then before returning the engine to service:

(i) Remove the LPT rotor stage 3 disk from service; or

(ii) Perform an FPI of the inner diameter surface forward spacer arm of the LPT rotor stage 3 disk as specified in paragraphs (l)(1)(i) through (l)(1)(iii) of this AD.

(6) Thereafter, within every 350 cycles since the last engine core vibration survey, perform the engine core vibration survey as required in paragraphs (k)(1) through (k)(5) of this AD.

(7) If the engine has experienced any vibration reported by maintenance or flight crew that is suspected to be caused by the engine core (N2), perform the engine core vibration survey as required in paragraphs (k)(1) through (k)(5) of this AD within 10 cycles after the report.

(8) Vibration surveys carried out in an engine test cell as part of an engine manual performance run fulfill the vibration survey requirements of paragraphs (k)(2) through (k)(3) of this AD.

(l) Initial and Repetitive FPI of LPT Rotor Stage 3 Disks

(1) At the next shop visit after the effective date of this AD:

(i) Clean the LPT rotor stage 3 disk forward spacer arm, including the use of a wet-abrasive blast, to eliminate residual or background fluorescence.

(ii) Perform an FPI of the LPT rotor stage 3 disk forward spacer arm for cracks and for a band of fluorescence. Include all areas of the disk forward spacer arm and the inner diameter surface forward spacer arm of the LPT rotor stage 3 disk.

(iii) Remove the disk from service before further flight if a crack or a band of fluorescence is present.

(2) Thereafter, clean and perform an FPI of the LPT rotor stage 3 disk forward spacer arm, as specified in paragraphs (l)(1)(i) through (l)(1)(iii) of this AD, at each engine shop visit that occurs after 1,000 cycles since the last FPI of the LPT rotor stage 3 disk forward spacer arm.

(1) For disks that have fewer than 3,200 flight cycles since new (CSN) on the effective date of this AD, remove the disk from service before exceeding 6,200 CSN.

(2) For disks that have 3,200 CSN or more on the effective date of this AD, do the following:

(i) If the engine has a shop visit before the disk exceeds 6,200 CSN, remove the disk from service before exceeding 6,200 CSN.

(ii) If the engine does not have a shop visit before the disk exceeds 6,200 CSN, remove the disk from service at the next shop visit after 6,200 CSN, not to exceed 3,000 cycles from the effective date of this AD.

(n) Installation Prohibition

(1) After the effective date of this AD, do not install or reinstall in any engine any LPT rotor stage 3 disk that exceeds the new life limit of 6,200 CSN.

(2) Remove from service any LPT rotor stage 3 disk that is installed or re-installed after the effective date of this AD, before the disk exceeds the new life limit of 6,200 CSN.

(o) Definitions

(1) For the purposes of this AD, an EGT above redline is a confirmed over-temperature indication that is not a result of EGT system error.

(2) For the purposes of this AD, a shift in the smoothed EGT trending data is a shift in a rolling average of EGT readings that can be confirmed by a corresponding shift in the trending of fuel flow or fan speed/core speed (N1/N2) relationship. You can find further guidance about evaluating EGT trend data in GE Company Service Rep Tip 373 ”Guidelines For Parameter Trend Monitoring.”

(3) For the purposes of this AD, an engine shop visit is the induction of an engine into the shop after the effective date of this AD, where the separation of a major engine flange occurs; except the following maintenance actions, or any combination, are not considered engine shop visits:

(i) Induction of an engine into a shop solely for removal of the compressor top or bottom case for airfoil maintenance or variable stator vane bushing replacement.

(ii) Induction of an engine into a shop solely for removal or replacement of the stage 1 fan disk.

(iii) Induction of an engine into a shop solely for replacement of the turbine rear frame.

(iv) Induction of an engine into a shop solely for replacement of the accessory gearbox or transfer gearbox, or both.

(v) Induction of an engine into a shop solely for replacement of the fan forward case.

(4) For the purposes of this AD, a raw EGT trend data point above the smoothed average is a confirmed temperature reading over the rolling average of EGT readings that is not a result of EGT system error.

(p) Previous Credit

(1) A BSI performed before the effective date of this AD using AD 2010-06-15, Amendment 39-16240 (75 FR 12661, March 17, 2010) or AD 2010-12-10, Amendment 39-16331 (75 FR 32649, June 9, 2010) or AD 2011-02-07, Amendment 39-16580 (76 FR 6323, February 4, 2011) within the last 75 cycles, satisfies the initial BSI requirement in paragraph (f)(1) of this AD.

(4) An FPI of the LPT rotor stage 3 disk forward spacer arm performed before the effective date of this AD using AD 2011-18-01, Amendment 39-16783 (75 FR 52213, August 22, 2011), within the last 1,000 flight cycles of the LPT rotor stage 3 disk, satisfies the initial inspection requirements in paragraphs (l)(1)(i) through (l)(1)(iii) of this AD.

(2) For service information identified in this AD, contact General Electric Company, GE-Aviation, Room 285, 1 Neumann Way, Cincinnati, OH 45215, phone: (513) 552-3272; email:geae.aoc@ge.com.You may review copies of the referenced service information at the FAA, Engine & Propeller Directorate, 12 New England Executive Park, Burlington, MA. For information on the availability of this material at the FAA, call (781) 238-7125.

(s) Material Incorporated by Reference

(1) You must use the following service information to do the UIs required by this AD, unless the AD specifies otherwise. The Director of the Federal Register approved the incorporation by reference (IBR) under 5 U.S.C. 552(a) and 1 CFR part 51 of the following service information on July 22, 2011: General Electric Company Service Bulletin No. CF6-50 S/B 72-1312 Revision 1, dated October 18, 2010.

(3) You may review copies of the service information at the FAA, Engine & Propeller Directorate, 12 New England Executive Park, Burlington, MA. For information on the availability of this material at the FAA, call (781) 238-7125.

(4) You may also review copies of the service information that is incorporated by reference at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call (202) 741-6030, or go to:http://www.archives.gov/federal-register/cfr/ibr_locations.html.

We are announcing the requirement that appointed representatives file certain appeals using our electronic systems in matters for which the representatives request direct fee payment. This is the first service required under the regulation we published on September 12, 2011 (76 FR 56107), Requiring Use of Electronic Services.

DATES:

The effective date of this notification of implementation of requirement is March 16, 2012.

For information on eligibility or filing for benefits, call our national toll-free number, 1-(800)-772-1213 or TTY 1-(800)-325-0778, or visit our Internet site, Social Security Online, athttp://www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION:Requiring Electronic Filing of Appeals

On September 12, 2011, we published final rules that require representatives to conduct business with us electronically at the times and in the manner we prescribe on matters for which the representative requests direct fee payment. At the time, we did not require representatives to use any specific electronic service. Rather, in the preamble to the final rule (76 FR 56107), we stated that, “Once we determine that we should make a particular electronic service publicly available because it works well, we will publish a notice in theFederal Register. The notice will contain the new requirement(s) and a list of all established electronic service requirements.” We also said in the preamble that we would adjust the burden for affected Office of Management and Budget (OMB) approved collections before requiring representatives to use the collections' electronic versions. We published a notice on December 1, 2011 (76 FR 74838) concerning the burden adjustment for the affected electronic services under OMB No. 0960-0144, Disability Report-Appeal, OMB No. 0960-0269 (Request for Hearing by Administrative Law Judge), and OMB No. 0960-0622, Request for Reconsideration.

As of March 16, 2012, we will begin mandating electronic filing of certain appeals in each matter in which a representative requests direct payment of the authorized fee. This electronic filing requirement is limited to the filing of a request for reconsideration or for a hearing by an administrative law judge for disability claims under title II of the Social Security Act (Act) or Supplemental Security Income claims based on disability or blindness under title XVI of the Act denied for medical reasons. Representatives must satisfy this electronic filing requirement by using our Internet Appeals web portal:www.socialsecurity.gov.

A representative has an affirmative duty to comply with this requirement. We may investigate to determine if a representative purposefully violated this duty or is attempting to circumvent our rules. We may sanction a representative who does not follow these rules. However, we will not reject or delay a claimant's request or process it differently if a representative fails to comply with this electronic filing requirement.

Claimants, whether they are represented or not, and representatives who are not eligible for or who do not request direct fee payment on a matter, may continue to file all appeal requests either electronically, on paper, or in any manner we prescribe.

Additional Information

Additional information is available on our Representing Claimants Web site athttp://www.ssa.gov/representation/or it can be obtained by writing to: Social Security Administration, Office of Public Inquiries, Windsor Park Building, 6401 Security Boulevard, Baltimore, MD 21235.

The Employment and Training Administration (ETA) of the Department of Labor (Department) issues this final rule to implement an additional indicator for volunteer work in the Senior Community Service Employment Program (SCSEP). Specifically, this rule amends our regulations regarding Performance Accountability for title V of the Older Americans Act (OAA) and corresponding definitions. These regulations provide administrative and programmatic guidance and requirements for the implementation of the SCSEP.

DATES:

Effective date:This final rule is effective March 1, 2012. The information collection requirements contained in this rule have been submitted to OMB for approval; however, that approval is pending. Upon OMB concluding its review, the Department will publish a subsequent notice to announce OMB's action on the request and when the information collections will take effect.

FOR FURTHER INFORMATION CONTACT:

Judith Gilbert, Team Leader, Division of National Programs, Tools and Technical Assistance, Office of Workforce Investment, U.S. Department of Labor, 200 Constitution Avenue NW., Room S-4209, Washington, DC 20210; telephone (202) 693-3046 (this is not a toll-free number). Individuals with hearing or speech impairments may access the telephone number above via TTY by calling the toll-free Federal Information Relay Service at 1-(800)-877-8339.

SUPPLEMENTARY INFORMATION:

The preamble to this Final Rule is organized as follows:

I. Background—provides a brief description of the development of the final rule.II. Summary of the Comments—provides an overview of the comments received.III. Section-by-Section Review—summarizes and discusses changes to the SCSEP regulations.IV. Administrative Information—sets forth the applicable regulatory requirements.I. Background

The SCSEP, authorized by title V of the OAA, is the only Federally-sponsored employment and training program targeted specifically to low-income older individuals who want to enter or re-enter the workforce. Participants must be unemployed and 55 years of age or older and have incomes at no more than 125 percent of the Federal poverty level. The program offers participants training at community service assignments in public and non-profit agencies. The dual goals of the program are to promote useful opportunities in community service activities and to also move SCSEP participants into unsubsidized employment, where appropriate, so that they can achieve economic self-sufficiency. The Older Americans Act Amendments of 2006, Public Law 109-365 (2006 OAA), amended the statute authorizing the SCSEP and necessitated changes to the SCSEP regulations in 20 CFR part 641. A final rule promulgating such changes was published on September 1, 2010. 75 FR 53786. Previously, an interim final rule (IFR) on performance measures waspublished on June 29, 2007, and a notice of proposed rulemaking (NPRM) was published on August 14, 2008. This statute requires the Department to issue definitions of any indicator of performance through regulation. OAA § 513(b)(3).

As established in the SCSEP Final Rule published September 1, 2010, there are eight performance measures, of which six are core indicators and two are additional indicators. 20 CFR 641.700(b) and (c). The OAA requires the grantees and the Secretary of Labor to “reach agreement on the expected level of performance” for the six core indicators, but has no such requirement for the additional indicators. OAA § 513(a)(2)(C).

In comments on the SCSEP IFR of June 29, 2007, and the SCSEP NPRM of August 14, 2008, several commenters expressed concern that the proposed measures were not appropriate to the SCSEP because they placed an undue emphasis on employment outcomes and did not adequately reflect the importance of community service. Grantees who commented said that they felt the SCSEP performance measurement system did not adequately value community service and that there was too much emphasis on employment outcomes.

Although in the SCSEP Final Rule published on September 1, 2010, we declined “at this time” to adopt any additional indicators beyond those required by statute, after due consideration, the Department has decided that the benefits of adopting an additional indicator of volunteer work outweigh the additional burden of collecting the data for the indicator. Under its authority in OAA § 513(b)(2)(C) to add additional indicators of performance, the Department solicited comments on an additional performance indicator for volunteer work by publishing the SCSEP NPRM on an Additional Indicator for Volunteer Work, on November 23, 2010. 75 FR 71514. The additional indicator outlined in the NPRM proposes volunteer work as a way to provide additional information and emphasis on the community service goal of SCSEP. The summary of the comments from that NPRM follows.

II. Summary of the Comments

We received 113 comments on the NPRM from State and local governmental entities, non-profit organizations that host or help to place participants, academic professionals in the field of gerontology and several private citizens. Overall, comments on the NPRM were extremely supportive of the NPRM, stating that the NPRM clearly supports Congressional intent as reflected in the statement of purpose and the dual goals of SCSEP.

The main reason cited by most commenters for supporting the additional indicator was the large and rapidly growing body of research about the important benefits of volunteer work for the elderly and the positive impact their volunteer work has on the larger community. Specifically, several commenters, including a director of a multi-year research project on older adult civic engagement, cited a report from the Corporation for National and Community Service, “* * * `The Health Benefits of Volunteering: A Review of Recent Research,' [which] documents that those who volunteer have lower mortality rates, greater functional ability, and lower rates of depression later in life than those who do not volunteer.” Commenters also noted that volunteerism is more likely to occur where people are invited to volunteer, or where volunteer options are presented to them, therefore improving the pool of trained, active volunteers in communities across the country. Finally, according to the comments, “* * * [R]esearch consistently shows that older volunteers in particular benefit greatly from improved physical well-being, enhanced self-esteem, and a greater sense of personal accomplishment.” This assertion is supported by the research cited above.1

1See generally, The Health Benefits of Volunteering, A Review of Recent Research, The Corporation for National and Community Service, 2007, available at:http://www.nationalservice.gov/about/role_impact/performance_research.asp#HBR.

Three comments were submitted that opposed the proposed additional indicator. These commenters voiced strong opposition to the additional indicator, suggesting that the focus of SCSEP should be on the unsubsidized employment goal alone, rather than a shared emphasis with community service. These commenters also were concerned that volunteerism would discourage employers from hiring participants when they could continue to volunteer. However, the purpose of this regulation is not to create an either/or situation, where we encourage volunteer work over employment or vice versa. Rather, the point is to ask grantees and/or sub-grantees to make a good faith effort to account for any participants who choose to volunteer post-SCSEP entry, regardless of whether they also have found unsubsidized employment. The information culled from this additional indicator will provide further information on both the impact of the SCSEP on the individual SCSEP participants, and the impact of the SCSEP on local communities through an increase in volunteerism by both current and former SCSEP participants.

Finally, a few other commenters were concerned about whether “a measure of volunteerism as a program outcome may be misinterpreted by policy makers” because other “successful programs administered by the Corporation for National and Community Service are being operated at a considerably lower unit cost.” Essentially, these commenters are concerned that the SCSEP budget will suffer because, in their view, the reason for existing support from lawmakers is based entirely on SCSEP's “outstanding record of placing the hardest to serve older workers in employment and providing paid community service opportunities to those enrolled.” The Department understands this concern and agrees that an important connection exists between SCSEP's outstanding record of placement and its continued funding by Congress. However, as discussed above, the OAA laid out dual goals for the SCSEP: unsubsidized employment and community service. It is appropriate to consider the success of the program in achieving both of these goals. Consequently, the Department believes that this volunteerism indicator will reinforce the value of the community service aspect of SCSEP.

The Department acknowledged in the September 1, 2010 Final Rule that unsubsidized employment is not a suitable or appropriate outcome for every SCSEP participant, and that while our participants are low-income and in need of financial support, being employed may not be an appropriate or achievable outcome for every individual participant. Rather, because community service is an equally important goal of SCSEP, as envisioned by Congress in the OAA, the Department is following Congress' lead by collecting information about how participation in SCSEP community service leads to continued service to the community after participants exit SCSEP. DOL finds this information valuable not only for those individuals for whom unsubsidized employment post-SCSEP is not an appropriate or achievable outcome, but also for those who do obtain unsubsidized employment. We are not collecting informationonlyfor those who volunteer after exit without having a job; rather, we are collecting information regardless of whether the participant also has found unsubsidized employment.

We discuss the more specific substantive comments received on theNPRM in Section III below. Section III does not include discussion of those provisions that were not the subject of a comment, or that were not revised for technical reasons. We have adopted such provisions as proposed, without further discussion.

III. Section-by-Section Review

In this section, we discuss the comments on specific provisions of the proposed regulation, our responses to them and any changes to the regulations that we made as a result of the comments.

Section 641.140 of the SCSEP regulations provides definitions for the SCSEP, including definitions relevant to the SCSEP performance measures and indicators. The NPRM proposed to amend the definitions in § 641.140 to accommodate a new additional indicator in § 641.710. The NPRM proposed to add “entry into volunteer work” to the definition of “additional indicators.” The existing regulations provide that the only additional indicators are the two required by the statute: (1) retention in unsubsidized employment for 1 year; and (2) the satisfaction of participants, employers and their host agencies with their experiences and the services provided. The term “additional indicators” now would include three indicators.

This Final Rule amends the proposed rule to add a new definition of “volunteer work” to § 641.140 for clarity and uniformity, so that all grantees understand and use the same definition, all seniors are treated the same, and all data we receive are comparable from grantee to grantee. The original language of this definition in the NPRM referred only to “a public agency of a State, local government or intergovernmental agency, or for a charity or similar nonprofit organization.” One commenter suggested that we add specific language recognizing that volunteer work can occur in faith- or community-based organizations, since they also provide significant community service opportunities. We agree. Although the proposed definition was not intended to exclude volunteer work with faith- or community-based organizations, for the sake of clarity we have amended the definition to include faith- or community-based organizations as among those entities for which volunteer work may be performed.

Upon further reflection, for data collection purposes, we also have broadened the language of the definition to make clear that it includes informal volunteer work that an individual performs on his or her own and not through an organization. An example would be a woman who invites neighborhood girls to her home after school for sewing classes. This type of informal volunteering is fairly common and is as likely to have positive effects on those who volunteer as is a volunteer activity conducted through non-profit organizations. This informal volunteer work does not include service performed for a member of the individual's own family or of the individual's own household since the self-interest of the individual makes it impossible to determine whether it is being performed with the intent to help others, which is the essence of volunteer work. Because the circumstances under which participants may enter into informal volunteer activities may vary widely, we will not count such activities in the performance indicator. But we are interested in capturing the positive impact on participants who enter into informal volunteer activities, so we will collect information about such volunteer activities. Therefore, these type of informal volunteer activities will not be included in the calculation of the “entry into volunteer indicator” under § 641.140. The Department will collect and share information about the informal volunteer work for information purposes only.

In another change, we have deleted the portion of the definition that reads: “[v]olunteer work does not include work a former participant performs that is similar or identical to work the former participant performed for compensation for the organization.” From a reading of the comments, it is apparent that this language was confusing, and detracted from our primary goal of creating a definition of “volunteer” that is consonant with that concept as it is applied under the Fair Labor Standards Act (FLSA), 29 U.S.C. 201et seq.,a statute that is administered and enforced by the Department's Wage and Hour Division. SCSEP has always prohibited participants from volunteering at the host agency at which they are performing their community service assignment. This deletion is meant to clarify that this prohibition does not extend to volunteering at the host agency after exit from the program, nor does it prohibit a former SCSEP participant from using the skills learned in a SCSEP placement when later volunteering for another organization.

The definition, as revised, now reads that volunteer work means “(1) for purposes of § 641.140 of this part, activities or work that former participants perform for a public agency of a State, local government or intergovernmental agency, or for a charity or not-for-profit organization, including faith-based or community-based organizations, for civic, charitable, or humanitarian reasons, and without promise, expectation, or receipt of compensation; (2) for informational reporting purposes, volunteer work also can include similar activities that a former participant performs on his or her own that are not conducted through a formal organization or agency as long as those activities are not performed for a member of the former participant's family or of the individual's own household. These types of volunteer activities will not be included in the calculation of the “entry into volunteer work” indicator under § 641.140.” This definition closely follows the concept of a volunteer as it is used under the FLSA, which recognizes the generosity and public benefit of volunteering. Encouraging volunteerism, however, must be balanced with the fundamental purpose of the FLSA, which is to prevent covered employers from gaining an unfair competitive advantage through payment of substandard wages.See Tony and Susan Alamo Found.v.Sec'y of Labor,471 U.S. 290, 296 (1985).

Grantees, sub-grantees and host agencies should be aware that the FLSA, and in particular its definitions of “employee” and “employ,” has been interpreted quite broadly to effectuate its remedial purposes.See, e.g., Alamo Found.,471 U.S. at 299. For example, the Department has consistently stated that individuals cannot volunteer for for-profit entities, or volunteer in the business and commercial activities of a non-profit organization when those activities are covered by the FLSA. Likewise, so-called volunteer work that an individual performs for a former employer will be closely scrutinized to determine whether an employment relationship exists, particularly if the individual is performing the same services for which he or she was previously employed.See, e.g.,29 CFR 553.103.

We recognize that the new indicator for entered volunteer work is based on self-report by former participants and that grantees are not in a position to monitor the conditions in the nonprofit organizations in which former participants perform volunteer work. However, grantees, sub-grantees, and nonprofit organizations should consult with their nearest Wage and Hour Division office if they have questions about whether activities performed bycurrent or former SCSEP participants constitute employment under the FLSA.

Additional information on the FLSA definitions of “employer,” “employee,” and “employ” is available in the Wage and Hour's Field Operations Handbook Chapter 10 (http://www.dol.gov/whd/FOH/FOH_Ch10.pdf). For information on finding local Wage and Hour Division offices, please visit:http://www.dol.gov/whd.

20 CFR 641.700 separates SCSEP indicators into two categories: core and additional. The NPRM proposed to amend § 641.700(a) to add a new additional indicator. Additional indicators are not subject to goal-setting and therefore are not subject to corrective action. However, the statute does mandate that the Department annually publish each grantee's performance on additional indicators. In addition, the NPRM also proposed to amend paragraph (c)(3), which currently only lists the additional indicators of employment retention and customer satisfaction, to reflect that the Secretary has designated entry into volunteer work as an additional indicator.

DOL intends for the new indicator of “entered volunteer work” to parallel the “entered employment” measure, which grantees have been reporting since 2004. SCSEP grantees can capture much of the information required for this indicator at the time of exit and need only confirm the participant's engagement in volunteer work at any time during the quarter after the exit quarter, in the same way as grantees have long captured the data for entered employment at the first follow-up after exit. We note that during this brief follow-up with former participants, grantees may also learn if the participants have obtained unsubsidized employment, of which the grantee was not previously aware, and for which placement the grantee also may obtain entered employment credit. Like the entered employment measure, which excludes participants who were employed at the time of enrollment, the new indicator excludes those who are engaged in volunteer work at the time of entry into the SCSEP. However, as is true with the entered employment measure, grantees will collect data on several aspects of the volunteer work, including whether the participant had been performing volunteer work at the time of entry into the SCSEP or during the community service assignment, and information about the type of volunteer work performed after exit, the setting in which it is performed, and the number of hours of volunteer work per week. DOL will collect data on these characteristics in the SCSEP data collection system so they can be used for analysis and additional reporting, but DOL will not use the data to measure the performance of the grantee. The actual measure itself will report only on the percent of participants who were not volunteering at the time of enrollment but are volunteering after exit.

Several commenters suggested that the regulatory text be changed to delete “entry into” and substitute with “new or continued participation in” volunteer work. A number of commenters appeared to mistakenly interpret the exclusion of individuals already volunteering from the indicator as an exclusion from SCSEP eligibility and suggested we remove the restriction that participants cannot be engaged in volunteer activity upon enrollment in SCSEP. One commenter raised concerns about who might be excluded from the broad definition, asking, “Would everyone who volunteered at the time of entry into SCSEP be excluded regardless of type/extent of volunteerism?” Another commenter said that “[s]ince I have observed many seniors who volunteer while also doing paid work, I would recommend that you consider not imposing the restriction that SCSEP enrollees not be engaged in volunteering work before leaving the program.”

In response to these comments, we are explaining in this preamble that the new indicator will have no impact on eligibility and explaining why the indicator does not count those who were volunteering before enrollment. As stated earlier, DOL will collect data about those individuals who were volunteering before SCSEP entry and will also share this data when it reports the additional indicator of entry into volunteer work, which does not include those who were volunteering prior to entry. The exclusion of participants who were doing volunteer work at the time of enrollment applies only to determining who is in the pool of participants counted in the additional indicator of entry into volunteer work. It has nothing to do with eligibility for SCSEP. The purpose of the new indicator is to determine what effect SCSEP participation has on former participants' desire to remain active and continue their community service through volunteer work. There is little value in collecting a simple count of SCSEP participants who volunteer after exit unless we know what their status was before enrollment. Without that information, we are merely reporting something about the individuals who enrolled, while not necessarily revealing the impact of SCSEP. Specifically, if we do not narrow the pool of participants to exclude those participants doing volunteer work already when they enrolled in SCSEP, then we are unable to correlate their volunteerism after SCSEP with their participation in SCSEP.

The Department proposed this additional indicator to identify volunteer work initiated after enrollment so that we can define the impact that SCSEP has on the lives of participants, not only during but also after exit from the program. Therefore, individuals who reported having volunteered upon enrollment are not included in any way in the calculation of the volunteer work indicator. For these reasons, we do not want to include these individuals in the additional indicator.

Some commenters who objected to the language about “entry into” volunteer work also misunderstood the purpose and effect of the new indicator. Grantees are required by the SCSEP Final Rule published on September 1, 2010 to assist participants in finding unsubsidized employment if that goal is feasible for them. The core measure of entered employment provides an additional incentive for grantees to provide this assistance and to claim credit for unsubsidized placements whenever possible. However, if unsubsidized employment is not feasible, or if participants are due to exit without having secured unsubsidized employment, grantees are obligated to assist participants in achieving other forms of self-sufficiency, which includes opportunities to continue or start volunteer work after the SCSEP participation ends. This volunteer service is not necessarily an alternative to employment; indeed, it may occur concurrently with unsubsidized employment. The new indicator merely captures volunteer service where it exists and reports it as an additional program outcome.

How are the performance indicators defined? (§ 641.710)

The NPRM proposed to establish the new additional indicator in § 641.710 by adding a new paragraph to (b)(3), which defines the “entry into volunteer work” measure. This Final Rule adopts the additional indicator as proposed. As set forth above, DOL intends for the new indicator to parallel the existing core measure of entered employment, which SCSEP has been reporting since 2004. The denominator for the new indicatorconsists of all participants who exit during a quarter, and the numerator consists of all those participants who are engaged in any volunteer work in the quarter after they exited. The indicator entirely excludes participants who were engaged in volunteer work at the time of entry into the SCSEP: such participants are neither in the denominator nor in the numerator. As explained above, DOL will collect and report the data for such individuals separately and not as an additional program outcome.

In order to provide context for the new indicator and to make it more useful, grantees will enter into the SCSEP data system information on the characteristics of the volunteer work (as they currently do for the characteristics of unsubsidized employment), including the number of hours per week and whether participants were engaged in volunteer work at the time of entry into the SCSEP or during their community service assignment, so that it will be possible to determine which participants are newly engaged in volunteer work after exiting as a result of participating in the SCSEP and which are continuing to do volunteer work. Later in this preamble, the Paperwork Reduction Act (PRA) section sets forth the data elements that DOL will capture in conjunction with this new indicator.

Several commenters suggested that volunteer work should be on the list of excluded exits for the Common Measures, described in Training and Employment Guidance Letter (TEGL) No. 17-05, so that it is not considered a negative exit but rather a neutral outcome, and so that it would keep documentation and follow-up required of sponsors to a minimum. Since the additional indicator supplements entered employment and is not an alternative to it, making volunteer service an additional exclusion under the Common Measures TEGL is not necessary. Whether an exiter who engages in volunteer work after exit qualifies for an exclusion under the TEGL is determined by the reason for the exit, not by how the participant chooses to spend her time after exit. The TEGL addresses only the core measure of entered employment and has nothing to do with the additional indicators.

Other commenters said volunteer service should be measured in ways that parallel the other additional indicators, rather than the core indicators. For example, one commenter recommended that “[v]olunteering should be measured in a manner parallel to * * * `customer satisfaction' or `retention in unsubsidized employment for 1 year' and should not parallel the measurement of a core indicator such as `entered employment.' ” One commenter expressed concern “that in an attempt to `parallel' the entered employment measure, resulting data collection requirements will be unnecessarily burdensome when implemented.” Another commenter suggested “a more simplistic process that allows grantees to track participants 30 days after exit” and that the Department should “provide additional guidance on documenting such exits in SPARQ” before publishing this Final Rule, as well as reduce paperwork “by allowing grantees to utilize the same documentation for the `entered employment' performance measure as acceptable documentation for [v]olunteerism.” Further, another commenter recommended that the indicator should include “quantifying community satisfaction with the SCSEP volunteer and the number of hours that are donated to the community.”

We understand the commenters' concerns, but those who suggest that we should follow the approach of the additional indicators rather than the core indicators overlook that the customer satisfaction measures employ a well defined and universally used definition (the American Customer Satisfaction Index, the ACSI) and that the indicator for retention at one year employs a definition that closely follows the common measures. Because grantees are familiar with the entered employment indicator as a useful and meaningful way to capture information about SCSEP participants, we believe that paralleling that indicator to capture the rate of volunteer work is the most effective means to evaluate both the impact of SCSEP on continuing service to the community and enhanced quality of life for participants.

As one commenter suggested, the additional data collection that will accompany the new indicator will enable the Department to report the number of volunteer hours performed post-exit along with an estimate of their monetary value to the organizations and communities in which the service is performed, by multiplying the hours by the standard monetary value of volunteer work. Since the participant customer satisfaction survey already includes exiters in its sample, it may also be feasible to add a few additional questions to this survey in order to determine the satisfaction of exiters with their volunteer work and the impact of this volunteer work on their quality of life. We agree that such data would increase the value and usefulness of the indicator because DOL would be able to use this information to enhance the various reports and analyses of these issues that it routinely conducts.

Some commenters also were concerned about the entry into volunteer work definition's impact on grantees, not simply of the data collection burden, but also in helping participants seeking post-SCSEP volunteer positions overcome barriers to service. Commenters stated that grantees would need training on volunteerism to better assist older adults, and that without training, “it will be difficult to connect participants to opportunities well-suited and can be discouraging for some. Barriers to volunteerism exist just as they do in the SCSEP such as lack of transportation and location, working for free and not receiving a paycheck, conflicts in scheduling (much like those used for breaks in participation), care giving, costs associated with proper attire, and mismanagement of expectations of assigned tasks.” The Department recognizes these concerns but notes that grantees already have an obligation under the SCSEP Final Rule published on September 1, 2010 to prepare and implement transition plans for participants who are exiting the program without having secured unsubsidized employment. 20 CFR 641.570(a)(2). As part of the transition plan, grantees are expected to assess the participants' circumstances, including their degree of social engagement, and to assist participants in identifying volunteer activities that meet their needs and interests and that may serve to enhance their physical and emotional well-being. The Department already has provided considerable training and resources to the grantees on how to meet that obligation, and the Department intends to offer additional training and technical assistance as needed. The new additional indicator of entry into volunteer service provides a degree of credit to the grantees for doing this work, but it in no way imposes a new programmatic responsibility on them.

The Regulatory Flexibility Act (RFA) at 5 U.S.C. 603 requires agencies to prepare a regulatory flexibility analysis to determine whether a regulation will have a significant economic impact on a substantial number of small entities. Section 605(b) of the RFA allows an agency to certify a rule in lieu of preparing an analysis if the regulation is not expected to have a significant economic impact on a substantial number of small entities. Section 601 ofthe RFA defines small entities to include small businesses, small organizations, including not-for-profit organizations, and small governmental jurisdictions. Section 601(4) defines a small organization as any not-for-profit enterprise that is independently owned and operated and not dominant in its field.

SCSEP includes 74 grantees, and approximately 970 sub-recipients and sub-sub-recipients. More than 50 of the grantees are States, State agencies, or territories, and are not small entities as defined within the RFA. The vast majority of the rest are non-profit organizations, many of which may be categorized as small entities for RFA purposes. The Department does not have a precise number of small entities that may be impacted by this rulemaking.

The Department has determined that the economic impact of this Final Rule is not likely to be significant for any of these small entities, because these regulations will result in negligible additional costs to grantees and sub-recipients. This Final Rule involving SCSEP performance measures will have only a minor information collection impact on a number of small entities. DOL has addressed this burden by submitting to the Office of Management and Budget (OMB) a request for approval for changes to three of the four reporting forms before submission of this Final Rule. DOL estimated the increase in paperwork burden to be 1000 hours. The SCSEP is designed so that SCSEP funds cover the vast majority of the costs of implementing this program, including the costs of reporting the volunteer work indicator. We reached a similar conclusion in our review of the August 14, 2008 NPRM. At that time, the Department requested public comments on the potential economic impact that the rule may have on small entities and did not receive any comments on this question. For these reasons, the Department has determined and certifies that this Final Rule will not have a significant economic impact on a substantial number of small entities.

OMB has also determined that this rule is not a “major rule” for purposes of the Small Business Regulatory Enforcement Fairness Act (SBREFA), Public Law 104-121 (1996) (codified in scattered sections at 5 U.S.C.). SBREFA requires agencies to take certain actions when a “major rule” is promulgated. 5 U.S.C. 801. SBREFA defines a “major rule” as one that will have an annual effect on the economy of $100 million or more; that will result in a major increase in costs or prices for, among other things, State or local government agencies; or that will significantly and adversely affect the business climate. 5 U.S.C. 804(2).

This Final Rule will not significantly or adversely affect the business climate. First, the rule will not create a significant impact on the business climate because, as discussed above, SCSEP grantees are governmental jurisdictions and not-for-profit enterprises. Moreover, any secondary impact of the program on the business community would not be adverse. To the contrary, we believe the SCSEP assists the business community by training older Americans to participate in the workforce and benefits the overall community by providing volunteer work opportunities.

The Final Rule will also not result in a major increase in costs or prices for States or local government agencies. The SCSEP has no impact on prices. Finally, this Final Rule will not have an annual effect on the economy of $100 million or more.

Therefore, because none of the definitions of “major rule” apply in this instance, this Final Rule is not a “major rule” for SBREFA purposes.

B. Executive Orders 12866 and 13563

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.

As stated in the SBREFA analysis, this Final Rule will not have an annual effect on the economy of $100 million or more. However, the rule does raise novel policy issues about implementing an additional performance indicator on volunteer work in the SCSEP. The key policy change reinforces the dual purpose of the SCSEP by counting those who begin performing volunteer work—or who perform volunteer work in lieu of or in addition to unsubsidized employment—after participating in SCSEP. Therefore, the Department has submitted this Final Rule to OMB.

C. Paperwork Reduction Act

The purposes of the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501et seq.,include minimizing the paperwork burden on affected entities. The PRA requires certain actions before an agency can adopt or revise a collection of information, including publishing in theFederal Registera summary of the collection of information and a brief description of the need for and proposed use of the information and requesting public comments. 44 U.S.C. 3507.

Because the 2006 OAA necessitated changes in many of the SCSEP forms used by grantees before the effective date of the Act, in July 2007 the Department submitted to OMB for review and approval, in accordance with PRA § 3507(d), a modification to the SCSEP information collection requirements. The four-year strategy newly required by the 2006 OAA (see § 641.302) was accounted for in that PRA submission. OMB approved the SCSEP PRA submission (OMB control number 1205-0040) in October 2007 and again (without the added form and burden estimate for the volunteer work indicator) on April 18, 2011, extending the expiration date through April 30, 2014. For more information on this request, please visit:www.reginfo.gov.This Final Rule introduces new information collection requirements and thus requires a PRA submission.

A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information if the collection of information does not display a valid OMB Control Number.See5 CFR 1320.5(a) and 1320.6.

The Department has submitted the information collection contained in this final rule for review under the PRA to the OMB, as part of a revision to Control Number 1205-0040; however, OMB has not yet completed its review. The Department will publish an additional Notice to announce OMB's action on the request and when the information collection requirements will take effect.

Public Comments:

In the NPRM stage, the Department requested comments on the burdens imposed by information collections contained in this rule. The Department received eleven comments expressing concern about the burden on grantees and/or sub-grantees to collect information about former participants' volunteer activities post-SCSEP. The Department shares this concern and intends to preserve a balance between the value of information gained fromthis additional indicator and the burdens of extra data collection. This indicator is an additional indicator, not a core indicator, and thus has no goal-setting, no data validation, and no negative repercussions attached to it for the sponsors involved. This additional indicator is designed so that sponsors can obtain the required information during intake, at exit, and through brief and non-burdensome follow-up efforts with participants after their SCSEP service. While the Department understands that sponsors may not be able to reach every participant after exit from the program, we find that the data obtained through low burden follow-up efforts will provide valuable information to justify the minimal increase in burden.

While much of the information provided to OMB in support of the information collection request appears in this preamble, interested parties may obtain a copy of the full supporting statement by sending a written request to the mail address shown in theADDRESSESsection at the beginning of this preamble or by visiting thehttp://www.reginfo.gov/public/do/PRAMainWeb site.

D. Unfunded Mandates Reform Act

The Unfunded Mandates Reform Act (UMRA) of 1995 (Pub. L. 104-4, 2 U.S.C. 1501et seq.) requires an agency to “prepare a written statement” providing specific information if the rulemaking “is likely to result in promulgation of any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more” in any 1 year. Since the Department has determined that this Final Rule does not include any Federal mandate that may result in increased expenditure by State, local, and tribal governments, or by the private sector, of more than $100 million, it has not prepared the written statement under section 1532 of the UMRA.

E. Executive Order 13132

The Department has reviewed this Final Rule in accordance with Executive Order 13132 on federalism, and has determined that the Final Rule does not have “policies that have federalism implications.” As explained at § 1(a) of the Executive Order, “ `Policies that have federalism implications' refers to regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This rule does not have such “substantial direct effects” because it does not preempt any State law, nor interfere with functions essential to the State's separate and independent existence, nor impose any form or method of program administration on the States. In addition, this new measure is reasonably related to the purpose of the SCSEP program, which is a grant program that flows directly from the 2006 OAA, in which State participation is voluntary. Therefore, this Final Rule does not constitute a “substantial direct effect” on the States, nor will it alter the relationship, power, or responsibilities between the Federal and State governments; the relationship, power, or responsibilities were already established in the authorizing legislation.

F. Executive Order 13045

Executive Order 13045 concerns the protection of children from environmental health risks and safety risks. This Final Rule addresses the SCSEP, a program for older Americans, and has no impact on safety or health risks to children.

G. Executive Order 13175

Executive Order 13175 addresses the unique relationship between the Federal Government and Indian tribal governments. The order requires Federal agencies to take certain actions when regulations have “tribal implications.” Required actions include consulting with tribal governments before promulgating a regulation with tribal implications and preparing a tribal impact statement. The order defines regulations as having “tribal implications” when they have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Department has reviewed this Final Rule and concludes that it does not have tribal implications. Although tribes are sub-recipients of national SCSEP grant funds, this rule will not have a substantial direct effect on those tribes because, as outlined in the Regulatory Flexibility section of the preamble, there are only minor additional costs associated with implementing this Final Rule and these are covered by grant funds. This regulation does not affect the relationship between the Federal Government and the tribes, nor does it affect the distribution of power and responsibilities between the Federal Government and tribal governments.

Accordingly, we conclude that this Final Rule does not have tribal implications for the purposes of Executive Order 13175.

H. Environmental Impact Assessment

The Department has reviewed this Final Rule in accordance with the requirements of the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321et seq.), the regulations of the Council on Environmental Quality (40 CFR part 1500), and the Department's NEPA procedures (29 CFR part 11). This Final Rule will not have a significant impact on the quality of the human environment, and thus the Department has not prepared an environmental assessment or an environmental impact statement.

I. Assessment of Federal Regulations and Policies on Families

Section 654 of the Treasury and General Government Appropriations Act, enacted as part of the Omnibus Consolidated and Emergency Supplemental Appropriations Act of 1999 (Pub. L. 105-277, 112 Stat. 2681), requires the Department to assess the impact of this Final Rule on family well-being. An agency that determines that the rule will have a negative affect on families must support the rule with an adequate rationale.

The Department has assessed this Final Rule and determines that it will not have a negative effect on families. Indeed, we believe the SCSEP strengthens families by providing job training and support services to low-income older Americans.

J. Executive Order 12630

Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights, is not relevant to this Final Rule because the rule does not involve implementation of a policy with takings implications.

K. Executive Order 12988

This Final Rule has been drafted and reviewed in accordance with Executive Order 12988, Civil Justice Reform, and will not unduly burden the Federal court system. The regulation has been written so as to minimize litigation and provide a clear legal standard for affected conduct, and has been reviewed carefully to eliminate drafting errors and ambiguities.

L. Executive Order 13211

Executive Order 13211 is not relevant to this Final Rule because the rule will not have a significant adverse effect on the supply, distribution, or use of energy.

For the reasons discussed in the preamble, the Department of Labor amends 20 CFR part 641 as follows:

PART 641—PROVISIONS GOVERNING THE SENIOR COMMUNITY SERVICE EMPLOYMENT PROGRAM1. The authority citation for part 641 continues to read as follows:Authority:

42 U.S.C. 3056et seq.

2. Amend § 641.140 by revising the definition of “additional indicators” and adding the definition of “volunteer work” to read as follows:§ 641.140What definitions apply to this part?

Additional indicatorsmean retention in unsubsidized employment for 1 year; satisfaction of participants, employers and their host agencies with their experiences and the services provided; entry into volunteer work; and any other indicators of performance that the Secretary determines to be appropriate to evaluate services and performance. (OAA § 513(b)(2)).

Volunteer workmeans:

(1) For purposes of § 641.140 of this part, activities or work that former participants perform for a public agency of a State, local government or intergovernmental agency, or for a charity or not-for-profit organization, including faith-based or community-based organizations, for civic, charitable, or for humanitarian reasons, and without promise, expectation, or receipt of compensation;

(2) For informational reporting purposes, volunteer work also can include similar activities that a former participant performs on his or her own that are not conducted through a formal organization or agency as long as those activities are not performed for a member of the former participant's family or of the individual's own household. These types of volunteer activities will not be included in the calculation of the “entry into volunteer work” indicator under § 641.140.

(3) “Entry into volunteer work” is defined by the formula: Of those not engaged in volunteer work at the time of entry into the SCSEP, the number of such participants who perform volunteer work in the first quarter after the exit quarter, divided by the number of such participants who exit during the quarter.

The National Labor Relations Board (NLRB or Board) is amending regulations concerning the procedures for filing initial Freedom of Information Act (FOIA) requests. The revisions require that all FOIA requests for records located in Washington, DC, be made to the NLRB FOIA Officer in Washington, DC.

Section 102.117(c)(1) provides in part that “If the request is made for records in a Regional or Subregional Office of the Agency, it should be made to that Regional or Subregional Office; if for records in the Office of the General Counsel and located in Washington, DC, it should be made to the Freedom of Information Officer, Office of the General Counsel, Washington, DC; if for records in the offices of the Board or the Inspector General in Washington, DC, to the Executive Secretary of the Board, Washington, DC.”

II. Revision

FOIA requesters seeking records that are located in Washington, DC may not know whether the requested records are in the Office of the General Counsel, the Offices of the Board, or the Office of the Inspector General, and, accordingly, may misdirect the request. Currently, when a request is misdirected, the receiving office forwards it to the appropriate office and notifies the requester that it has done so. This requires a response by both the receiving and the appropriate offices, and delays the final response to the FOIA requester. By requiring that all requests for records located in Washington, DC be made to the NLRB FOIA Officer, a newly-created position, requesters need not know in which office the records they seek are located, and their requests will be processed more efficiently and expeditiously.

III. Administrative Procedure Act

Because the change involves rules of agency organization, procedure, or practice, the Agency is not required to publish it for comment under Section 553 of the Administrative Procedure Act (5 U.S.C. 553).

IV. Regulatory Flexibility Act

Because no notice of proposed rulemaking is required for procedural rules, the requirements of the Regulatory Flexibility Act (5 U.S.C. 601et seq.) pertaining to regulatory flexibility analysis do not apply to these rules. However, even if the Regulatory Flexibility Act were to apply, the NLRB certifies that these changes will not have a significant economic impact on small business entities since the changes make it easier for all FOIA requesters to file their requests.

V. Small Business Regulatory Enforcement Fairness Act

Because the rules relate to Agency procedure and practice and merely modify the Agency's existing procedures, the Board has determined that the Congressional review provisions of the Small Business Regulatory Enforcement Fairness Act (5 U.S.C. 801) do not apply.

VI. Paperwork Reduction Act

This revision does not impose any reporting or record keeping requirements under the Paperwork Reduction Act of 1995.

List of Subjects in 29 CFR Part 102

Administrative practice and procedure, Labor management relations.

For the reasons set forth above, the NLRB amends 29 CFR part 102 as follows:

PART 102—RULES AND REGULATIONS1. The authority citation for 29 CFR part 102 continues to read as follows:Authority:

2. Amend § 102.117 by revising paragraphs (c)(1) and (c)(2)(iii) and (v) to read as follows:§ 102.117Freedom of Information Act Regulations: Board materials and formal documents available for public inspection and copying; requests for described records; time limit for response; appeal from denial of request; fees for document search and duplication; files and records not subject to inspection.

(c)(1) Requests for the inspection and copying of records other than those specified in paragraphs (a) and (b) of this section must be in writing and must reasonably describe the record in a manner to permit its identification and location. The envelope and the letter, or the cover sheet of any fax transmittal, should be clearly marked to indicate that it contains a request for records under the Freedom of Information Act (FOIA). The request must contain a specific statement assuming financial liability in accordance with paragraph (d)(2) of this section for the direct costs of responding to the request. If the request is made for records in a Regional or Subregional Office of the Agency, it should be made to that Regional or Subregional Office. If the request is for records located in Washington, DC (in the Office of the General Counsel, the Offices of the Board, or the Office of the Inspector General), it should be made to the NLRB FOIA Officer, Washington, DC. Requests made to other than the appropriate office will be forwarded to that office by the receiving office, but in that event the applicable time limit for response set forth in (c)(2)(i) of this section shall be calculated from the date of receipt by the appropriate office. FOIA requests made to an office other than to the office where the records were generated may be referred to the generating office for response. In the case of records generated by the Inspector General in the possession of another office, or in the possession of the Inspector General but generated by another office of the Agency, the request will be referred to the appropriate FOIA officer for the generating office for decision. If the Agency determines that a request does not reasonably describe records, it may contact the requester to inform the requester either what additional information is needed or why the request is insufficient. Requesters may be given an opportunity to discuss their request so that requests may be modified to meet the requirements of this section.

(2) * * *

(iii) Within 20 working days after receipt of a request by the appropriate office of the Agency, a determination shall be made whether to comply with such request, and the person making the request shall be notified in writing of that determination. In the case of requests made for Inspector General records, that determination shall be made by the Inspector General. In the case of all other requests, that determination shall be made by the NLRB FOIA Officer, or the Regional or Subregional Office, as the case may be. If the determination is to comply with the request, the records shall be made promptly available to the person making the request and, at the same time, a statement of any charges due in accordance with the provisions of paragraph (d)(2) of this section will be provided. If the determination is to deny the request in any respect, the requester shall be notified in writing of that determination. Adverse determinations, or denials of requests, consist of: A determination to withhold any requested record in whole or in part; a determination that a requested record does not exist or cannot be located; a determination that what has been requested is not a record subject to the FOIA; a determination on any disputed fee matter, including a denial of a request for a fee waiver or reduction or placement in a particular fee category; and a denial of a request for expedited treatment. For a determination to deny a request in any respect, the notification shall set forth the reasons therefor and the name and title or position of each person responsible for the denial, shall provide an estimate of the volume of records or information withheld, in number of pages or in some other reasonable form of estimation (this estimate does not need to be provided if the volume is otherwise indicated through deletions on records disclosed in part, or if providing an estimate would harm an interest protected by an applicable exemption), and shall notify the person making the request of the right to appeal the adverse determination under provisions of paragraph (c)(2)(v) of this section.

(v) An appeal from an adverse determination made pursuant to paragraph (c)(2)(iii) of this section must be filed within 28 calendar days of the service of the adverse determination, in whole or in part. If the adverse determination was made by the NLRB FOIA Officer concerning records located in the Office of the General Counsel, Washington, DC, or by a Regional Office or a Subregional Office concerning records located there, the appeal shall be filed with the General Counsel in Washington, DC. If the adverse determination was made by the NLRB FOIA Officer concerning records in the Offices of the Board, or by the Inspector General concerning records generated by that office, the appeal shall be filed with the Chairman of the Board in Washington, DC. As provided in paragraph (c)(2)(iii) of this section, an adverse determination will notify the requester of the right to appeal the adverse determination and will specify where such appeal shall be filed. Within 20 working days after receipt of an appeal, the General Counsel or the Chairman of the Board, as the case may be, shall make a determination with respect to such appeal and shall notify the person making the request in writing. If the determination is to comply with the request, the record shall be made promptly available to the person making the request upon receipt of payment of any charges due in accordance with the provisions of paragraph (d)(2) of this section. If on appeal the denial of the request for records is upheld in whole or in part, the person making the request shall be notified of the reasons for the determination, the name and title orposition of each person responsible for the denial, and the provisions for judicial review of that determination under the provisions of 5 U.S.C. 552(4)(B). Even if no appeal is filed from a denial in whole or in part of a request for records by the person making the request, the General Counsel or the Chairman of the Board may, without regard to the time limit for filing of an appeal, sua sponte initiate consideration of an adverse determination under this appeal procedure by written notification to the person making the request. In such event, the time limit for making the determination shall commence with the issuance of such notification. An adverse determination by the General Counsel or the Chairman of the Board, as the case may be, will be the final action of the Agency. If the requester wishes to seek review by a court of any adverse determination, the requester must first appeal it under this section.

If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

Purpose of Program:The State Fiscal Stabilization Fund (SFSF) program provided States approximately $48.6 billion in formula grants to help stabilize State and local budgets and minimize and avoid reductions in education and other essential services. In exchange, States committed to advance education reform in four key areas: (1) Achieving equity in the distribution of effective teachers; (2) improving the collection and use of data; (3) standards and assessments; and (4) supporting struggling schools.

Summary of Final Revisions: In this notice, the Secretary (1) exempts certain States from collecting and reporting on Descriptors (a)(1) and (a)(2) and Indicators (a)(3) through (a)(7); (2) eliminates the requirement for States to report data annually for Indicators (c)(1) through (c)(9) and (d)(1) through (d)(6); (3) extends to December 31, 2013, upon submission of an approvable request by a State, the deadline for meeting the requirements under Indicators (b)(1) and (c)(12); (4) extends to December 31, 2013, upon submission of an approvable request by a State, the deadline for collecting and publicly reporting or developing the capacity to collect and publicly report student enrollment data under Indicator (c)(11) for high school graduates who enroll in an in-state public institution of higher education (IHE); and (5) applies an alternative standard, upon submission of an approvable request by a State, by which a State may meet the Indicator (c)(11) data collection and reporting requirements for high school graduates who enroll in in-state private, out-of-state private, or out-of-state public IHEs. The Secretary establishes December 31, 2013, as the deadline by which a State must meet the requirements of the Indicator (c)(11) alternative standard.

In addition, the Secretary establishes a priority that the Department may use in future discretionary grant competitions for States that have met the requirements of Indicator (b)(1) on or before the applicable deadline. Further, the Secretary establishes the authority to extend those sanctions to State educational agencies (SEAs) in States that have received an extension of the deadline to December 31, 2013, for Indicator (b)(1), (c)(11), or (c)(12) but fail to meet the revised deadline or that have received permission to use the alternative standard for Indicator (c)(11) but fail to meet the requirements of that standard by the deadline.

The Department also establishes the authority to take enforcement action against an SEA under certain circumstances where a State fails to meet the requirements of Indicators (b)(1), (c)(11), or (c)(12).

Background: Section 14005(d) of Division A of the ARRA required a State receiving funds under the SFSF program to provide assurances in four key areas of education reform: (1) Achieving equity in the distribution of effective teachers; (2) improving collection and use of data; (3) standards and assessments; and (4) supporting struggling schools.

In a notice of final requirements, definitions, and approval criteria published in theFederal Registeron November 12, 2009 (74 FR 58436) (November 2009 Notice), the Department established specific data and information requirements (assurance indicators and descriptors) that a State had to meet to demonstrate compliance with the statutory assurances. We also established specific requirements for the plans that a State had to submit as part of its application for the second phase of funding under the SFSF program. These plans describe the steps a State would take to collect and publicly report, or to develop the capacity to collect and publicly report, the required data and other information.

As we explained in the November 2009 Notice, these two sets of requirements make transparent the extent to which a State is implementing the promised reforms. Increased access to and focus on these data better enable States and other stakeholders to identify strengths and weaknesses in education systems and to determine where concentrated reform effort is warranted.

We are taking the actions in this notice in response to the January 18, 2011, Executive Order 13563 entitled “Improving Regulation and Regulatory Review” and the February 28, 2011, memorandum from the President to executive departments and agencies entitled “Administrative Flexibility, Lower Costs, and Better Results for State, Local, and Tribal Governments.” These documents direct each Federal executive department and agency to review periodically its existing significant regulations and determine whether any should be modified, streamlined, expanded, or repealed so as to make the department's or agency's regulatory program more effective or less burdensome. These modificationsaddress concerns raised by some States about the time necessary to meet the requirements in the November 2009 Notice.

As a result of our regulatory review of the SFSF program requirements, we also are publishing elsewhere in this issue of theFederal Registera notice of final requirement extending to January 31, 2012, the deadline for States to meet the data collection and reporting requirements of the SFSF indicators.

We note that in addition to the revised January 31, 2012, deadline for meeting the SFSF requirements, we are modifying certain other data collection and reporting requirements in this notice. All other SFSF requirements remain in effect as originally established.

In addition, we note that where the SFSF indicators make use of information in “Existing Collections” (see column 4 of the table in Section I ofState Fiscal Stabilization Fund: Summary of Final Requirementsathttp://www2.ed.gov/programs/statestabilization/summary-requirements.doc), the modification of an SFSF indicator does not affect other Federal requirements for those collections that are established under separate legal authority. Some of the data that States submit through the Department's EDFactssystem to meet requirements established under other authorities (e.g., Title I accountability data) are also reported publicly by States to meet the requirements of certain SFSF indicators. Those requirements established by other authorities are not affected by the modification of any SFSF indicator in this notice.

On September 23, 2011, we published a notice of proposed revisions to certain data collection and reporting requirements and proposed priority (NPR) in theFederal Register(76 FR 59074).

Public Comment:In response to our invitation in the NPR, we received comments from six entities. There are several differences between the NPR and these final requirements.

In the following section, we discuss substantive issues under the sections of the requirements to which they pertain. Generally, we do not address technical and other minor changes, or suggested changes the applicable statutory authority does not authorize us to make. In addition, we do not address general comments that raised concerns not directly related to the proposed provisions or the proposed priority.

Analysis of Comments and Changes:Deadline for Complying With Indicators (b)(1), (c)(11), AND (c)(12).

Comment:Three commenters expressed support for the Department's proposal to extend beyond January 31, 2012, the deadline for developing and implementing a statewide longitudinal data system (SLDS) under Indicator (b)(1) that includes all the 12 elements required under the America COMPETES Act. Further, five commenters supported the Department's proposal to extend beyond January 31, 2012, the deadline for complying with the requirements of Indicator (c)(11). One of these commenters stated that the need to establish a longer time frame for full compliance with Indicator (c)(11) seemed fair as it responded to comments that were discussed in the November 2009 Notice. In addition, one commenter expressed concerns about the cost of obtaining information on students who attend private and out-of-state IHEs.

Discussion:The Department appreciates the concerns expressed by commenters regarding the ability of States to fully comply with the requirements of Indicators (b)(1) and (c)(11) in a timely fashion. These concerns would also apply to Indicator (c)(12) because compliance with the requirements of that indicator is dependent upon the development and implementation of an SLDS. Because of these concerns, the Department believes that it is appropriate to extend the deadline for meeting the requirements of Indicators (b)(1), (c)(11), and (c)(12) to December 31, 2013 rather than December 31, 2012, as proposed in the NPR. An extension will be granted only to those States that submit an approvable extension request.

Change:The Department extends to December 31, 2013, upon submission of an approvable request by a State—

(a) The deadline for the development and implementation of an SLDS under Indicator (b)(1) that includes the 12 elements included in the America COMPETES Act;

(b) The deadline by which a State must collect and publicly report, or have the capacity to collect and publicly report, the required course completion data under Indicator (c)(12); and

(c) The deadline by which a State must collect and publicly report, or have the capacity to collect and publicly report, the student enrollment data required under Indicator (c)(11) for high school graduates who attend an in-state public IHE.

Under the alternative standard for Indicator (c)(11), the Department extends to December 31, 2013, the deadline by which a State must increase its current capacity to collect and publicly report the required student enrollment data for high school graduates who attend a private or an out-of-state public IHE.

Process for Requesting an Extension

Comment:One commenter suggested that the Department (1) create a streamlined and user-friendly form to request deadline extensions and use of the alternative standard; (2) approve extension requests for complying with the requirements of Indicators (b)(1), (c)(11), and (c)(12) before requiring a State to provide a revised plan for the applicable indicator; and (3) automatically grant an extension of the deadline for an indicator if the State has a later deadline for the same activity under another Department program.

Discussion:The Department is providing a streamlined and user-friendly form for requests to extend a deadline or use the alternative standard. The Department will approve these requests on the basis of assurances provided by the Governor and the Chief State School Officer. The State will have 60 days after submission of the request to provide the revised plan. If a State fails to meet the revised and approved State plan requirements, the Department will take appropriate enforcement actions. The Department's program offices do coordinate implementation of program requirements under various statutory or regulatory authorities. However, many programs have specific requirements that differ from the requirements of other programs. As a result, the Department often establishes program-specific requirements and deadlines and will not automatically extend the deadline for complying with the SFSF indicators and descriptors on the basis of a later deadline for another program.

Changes:None.

Elimination of Annual Reporting Requirements for Certain Indicators

Comment:One commenter supported the elimination of the annual reporting requirements for Indicators (c)(1) through (c)(9) and (d)(1) through (d)(6).

Discussion:The Department appreciates the support of the commenter and, as stated in the NPR, we do not believe that it is necessary to have States annually collect and publicly report these data given the availability of the data from other sources.

Changes:None.

Teacher and Principal Evaluation Systems

Comment:One commenter suggested that the Department extend beyond January 31, 2012, the deadline forcollecting and publicly reporting data related to teacher and principal evaluation systems. The commenter noted that the January 31, 2012, deadline is inconsistent with the timelines for the development and implementation of teacher and principal evaluation systems outlined in the September 23, 2011, ESEA Flexibility guidance.

Discussion:The Department agrees that a State with an approved ESEA Flexibility request should not have to report data and information on the current teacher and principal evaluation systems of its local educational agencies (LEAs) by the January 31, 2012, SFSF deadline because that State will have committed to developing, adopting, piloting, and implementing rigorous teacher and principal evaluation and support systems. The deadline for implementing rigorous teacher and principal evaluation systems under the ESEA Flexibility extends beyond the January 31, 2012, SFSF deadline. Therefore, the Department is eliminating the requirement for a State to collect and publicly report data under SFSF Descriptors (a)(1) and (a)(2) and Indicators (a)(3) through (a)(7) if that State has an approved ESEA Flexibility request.

Changes:We have modified the final requirements to provide that the collection and public reporting requirements under SFSF Descriptors (a)(1) and (a)(2) and Indicators (a)(3) through (a)(7) do not apply to a State that has an approved ESEA Flexibility request. Statewide Longitudinal Data System (Indicator (b)(1))

Comment:One commenter asked whether development and implementation of an SLDS may be predicated on the State's receiving an award under the Statewide Longitudinal Data Systems grant.

Discussion:ARRA requires all States, as a condition of receiving funds under the SFSF program, to develop and implement an SLDS that includes all 12 elements required under the America COMPETES Act. In its application for SFSF funding, each State assured that it would meet this requirement by the established deadline. Thus, a State must develop and implement such a system whether or not it receives an SLDS grant. A State could have used, among other funds, SFSF Government Services funds to meet this requirement.

Changes:None.

Comment:One commenter requested that the Department be flexible in determining whether a State has developed and implemented an SLDS that includes the 12 elements and that the Department share with States any expectations that it has for those elements.

Discussion:The Department understands that individual States' longitudinal data systems may vary and still meet the requirements of the America COMPETES Act. In addition, the Department acknowledges that State requirements and processes may affect the manner in which a State complies with ARRA's requirements. The Department will consider these factors when considering a State's compliance with the requirements of Indicator (b)(1). The Department intends to work collaboratively with States while reviewing State compliance with SFSF requirements, as it has done during the initial SFSF monitoring reviews.

Changes:None.

Comment:One commenter suggested that the Department require a State to provide, in its request for a further extension of the deadline for Indicator (b)(1), a description of the challenges that cause the need for the extension.

Discussion:During the Department's monitoring of State implementation of the SFSF program, a number of States indicated to us that competing challenges and diminished capacity have made it difficult for them to meet the previously established deadline for some of the more challenging indicators. In recognition of this, the Department has extended the deadline for meeting the requirements of all indicators from September 30, 2011, to January 31, 2012, and has established a process for States to request a further extension to December 31, 2013, of the deadline for the more challenging indicators (b)(1), (c)(11), and (c)(12). We believe that any benefits that might be derived from requiring a justification for this extension would not outweigh the additional burden placed on States to do so.

Comment:One commenter expressed concern about the expense associated with a State having to enter into multiple data-sharing agreements with IHEs to collect postsecondary student enrollment data. The commenter recommended that the Department consider extending its role to that of a broker of data-sharing agreements between public higher education consortia and other entities such as third-party companies and States. Alternatively, the commenter recommended that the Department eliminate the requirement that States collect enrollment data on high school graduates who attend private or out-of-state IHEs.

Discussion:The Department believes that because differences in State statutory and regulatory requirements could affect the nature and scope of data-sharing agreements between States and IHEs, it is appropriate that decisions regarding these matters be addressed at the State rather than the Federal level. The Department acknowledges that collecting enrollment data on high school graduates who attend private and out-of-state IHEs can be challenging and, therefore, is providing States with an alternative standard for meeting the requirements of Indicator (c)(11) for such students. However, we are not eliminating this data collection requirement because we believe that these data, together with the course completion data under Indicator (c)(12), provide stakeholders with critical information on the effectiveness of secondary education across States.

Changes:None.

Comment:One commenter requested that the Department clarify whether the alternative standard for collecting and publicly reporting data under Indicator (c)(11) applies to in-state and out-of-state private IHEs and out-of-state public IHEs. The same commenter inquired whether a State could propose an alternative standard or whether a State would only be permitted to use the standard established by the Department.

Discussion:The alternative standard, which was defined in the NPR, applies to in-state private IHEs, out-of-state private IHEs, and out-of-state public IHEs. To help ensure that all States are developing the capacity to collect and publicly report similar data, the Department has established an alternative standard that will be applied across all States. Thus a State may not propose its own alternative standard for complying with the requirements of Indicator (c)(11).

Changes:The Department has modified the alternative standard language to expressly state that the State must increase its capacity to collect and publicly report student enrollment data on high school graduates who attend in-state private IHEs, out-of-state private IHEs, and out-of-state public IHEs.

Comment:One commenter requested clarification on the requirements for the data analysis that a State must conduct regarding current capacity for reporting on students enrolled in private or out-of-state public IHEs in order to receive approval to use the Indicator (c)(11) alternative standard.

Discussion:In demonstrating that it has increased its capacity to collect and publicly report on student enrollment data for high school graduates who enroll in private or out-of-state IHEs, aState could, among other things, enter into data reciprocity agreements with contiguous States or States with which it has tuition reciprocity agreements.

Changes:None.

Comment:One commenter questioned the relevance of the information that a State seeking to use the alternative standard would have to submit by December 31, 2012, to demonstrate that it had increased its capacity to report on the enrollment of high school graduates in private and out-of-state IHEs. That commenter also questioned the need to impose additional burden on States before providing additional flexibility and the Department's authority to collect the data under the alternative standard. The commenter recommended that the Department further extend the January 31, 2012, deadline by which States must report student enrollment data under Indicator (c)(11) without submitting additional information.

Discussion:The Department believes that whether a State funds or enters into a data-sharing agreement with a private or out-of-state public IHE is relevant. A State is more likely to fund or enter into data-sharing agreements with those IHEs that enroll relatively large numbers of that State's residents. Further, the Department believes that the burden of meeting the requirements under the alternative standard will be minimal.

The Department has the authority to impose reasonable conditions on States in exchange for providing them with additional flexibility in meeting programmatic requirements. Because in certain instances the deadline for States to comply with the requirements of Indicator (c)(11) may be extended 27 months beyond the initial September 30, 2011, deadline, the Department believes that it is essential to collect the additional information required under the extension request. Use of the alternative standard is voluntary. Only if a State chooses to take advantage of the additional flexibility afforded under the alternative standard does it have to provide this information.

Changes:None.

Comment:One commenter recommended that the Department require States requesting authority to use the Indicator (c)(11) alternative standard to indicate in their requests whether they have regulatory or other authority over in-state private IHEs.

Discussion:Under the requirements for requesting use of the Indicator (c)(11) alternative standard, States must indicate for each in-state private IHE whether that IHE receives funding from the State. The Department believes this information, together with information on whether the State has a data-sharing agreement with these IHEs, provides sufficient indication of whether a State has authority over in-state private IHEs.

Changes:None

Comment:One commenter suggested that the Department require States to provide the percentage of their high school graduates who enroll in an in-state IHE to “help provide transparency around the extent of the challenge States face in tracking their students out-of-state.”

Discussion:Under Indicator (c)(11), a State must demonstrate that it has the capacity to collect and publicly report student enrollment data for high school graduates who enroll in in-state private, out-of-state private, and out-of-state public IHEs; however, a State is not required to actually collect and publicly report those data. Thus, it would impose a burdensome new requirement on States to require them to report by December 31, 2013, on the percentage of students who enroll in in-state IHEs.

Changes:None.

Postsecondary Course Completion Data

Comment:One commenter requested that the Department clarify for Indicator (c)(12) the following: (1) The categories of students for which a State should provide course completion data (degree-seeking or all students enrolled for credit; part-time and full-time students; students who remain enrolled in the same public IHE; and students who transfer to another public IHE); and (2) the starting point for calculating credits earned within “two years of enrollment” in Indicator (c)(12).

Discussion:States must have the capacity to report course completion data for those high school graduates who enroll for credit in a public IHE on a full-time or part-time basis within 16 months of their high school graduation. In determining whether a student has completed one year's worth of college credit applicable to a degree, as defined by the IHE, within two years of enrollment in an in-state public IHE, the State should consider the credits that the student earned at any in-state public IHE within two years of the date that the student initially enrolled in an in-state public IHE (as long as that initial enrollment was within 16 months of the student's high school graduation).

Changes:None.

Plan Requirements

Comment:One commenter asked the Department to clarify whether a Governor had to sign the revised plans that a State must submit to receive a further extension of the deadline for an indicator.

Discussion:In the request for an extension, the Governor and Chief State School Officer must sign an assurance that the State will submit a revised plan for Indicator (b)(1), (c)(11), or (c)(12), as applicable. The Governor and Chief are not required to sign the plan itself.

Changes:None.

Comment:One commenter inquired whether a State may use a plan adopted for other programs to meet the revised plan requirement for Indicators (b)(1), (c)(11), or (c)(12), as applicable.

Discussion:A State may use a plan adopted for another program so long as that plan meets the requirements established in this notice, including the requirement that the State meet the December 31, 2013, deadline.

Changes:None.

Comment:One commenter suggested that the Department make publicly available any revised plans submitted for Indicators (b)(1), (c)(11), and (c)(12).

Discussion:The Department will make the revised plans available on its Web site and encourages States to make them available on their Web sites as well.

Changes:None.

Priority

Comment:One commenter suggested the Department provide in future grant competitions a priority not only for States that meet the requirements of Indicator (b)(1) but also for States that meet the requirements of Indicators (c)(11) and (c)(12) by the applicable deadline.

Discussion:Although the Department recognizes the importance of a State being able to collect and publicly report the data required under Indicators (c)(11) and (c)(12), it wants to encourage States to focus on developing and implementing an SLDS that includes all of the elements required under the America COMPETES Act and, as a result, meets all of the requirements of Indicator (b)(1). The Department, therefore, is giving priority to those States that develop and implement an SLDS in a timely manner. We also note that if a State has developed and is implementing an SLDS that meets the statutory requirements, this will enable the State to comply with the requirements of Indicators (c)(11) and (c)(12).

Changes:None.

Revisions to Reporting Requirements:

Exemption From Reporting Requirements for Descriptors (a)(1) and (a)(2) and Indicators (a)(3) Through (a)(7)

A State that has an approved ESEA Flexibility request is exempt from thecollection and public reporting requirements under SFSF Descriptors (a)(1) and (a)(2) and Indicators (a)(3) through (a)(7).

Elimination of Annual Reporting Requirements for Indicators (c)(1) Through (c)(9) and (d)(1) Through (d)(6)

The Department requires each State to collect and publicly report, at least once, the data and other information required by Indicators (c)(1) through (c)(9) and (d)(1) through (d)(6). Any State that has already collected and publicly reported these data is not required to take any additional action for these indicators. Any State that has not already provided data under these indicators must do so by the January 31, 2012, deadline.

Extension of Deadline for Indicators (b)(1) and (c)(12)

The Department extends to December 31, 2013, upon submission of an approvable request by a State, the deadline for the development and implementation of an SLDS under Indicator (b)(1) that includes the 12 elements included in the America COMPETES Act. The Department also extends to December 31, 2013, upon submission of an approvable request by a State, the deadline by which a State must collect and publicly report, or have the capacity to collect and publicly report, the required course completion data under Indicator (c)(12).

An extension request must provide the specific information described under the headingRequirements for Requests for Extensions to December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard.

Revisions to Requirements Under Indicator (c)(11)

The Department extends to December 31, 2013, upon submission of an approvable request by a State, the deadline by which a State must collect and publicly report, or have the capacity to collect and publicly report, the student enrollment data required under Indicator (c)(11) for high school graduates who attend an in-state public IHE.

An extension request must provide the specific information under the headingRequirements for Requests for Extensions to December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard.

The Department also establishes an alternative standard by which a State may meet the Indicator (c)(11) data collection and reporting requirements with respect to high school graduates who enroll in in-state private, out-of-state private, or out-of-state public IHEs. Under the alternative standard, a State must increase, by December 31, 2013, its current capacity to collect and publicly report the required student enrollment data for high school graduates who attend an in-state private IHE, an out-of-state private IHE, or an out-of-state public IHE. A State will not be required to be fully capable of collecting and reporting these data by December 31, 2013.

For the purposes of the alternative standard, a State will be considered to be making acceptable progress in increasing its capacity to collect and publicly report student enrollment data for high school graduates who enroll in in-state private IHEs, out-of-state private IHEs, or out-of-state public IHEs through such activities as: (1) Entering into data reciprocity agreements with private in-state IHEs that receive any State funds, including those for student financial aid, research, or any other activities; (2) entering into data reciprocity agreements with private in-state IHEs over which the State exercises significant oversight, such as serving as an accrediting body; (3) entering into data reciprocity agreements with geographically contiguous States or States with which it has tuition reciprocity agreements; or (4) conducting a data analysis to determine the out-of-state IHEs where large numbers of the State's high school graduates enroll.

States that use the alternative standard for Indicator (c)(11) are required to publicly report, by December 31, 2013, the following—

(1) For each in-state private IHE—

(a) Whether the State provides funding to the IHE;

(b) Whether the State has a data-sharing agreement in place with the IHE and, if so, whether the data-sharing agreement enables the State to track its recent high school graduates; and

(2) For each out-of-state private or out-of-state public IHE with which the State has a data-sharing agreement—

(a) Whether the State provides funding to the IHE; and

(b) Whether the data-sharing agreement enables the State to track its recent high school graduates.

An extension request must include the specific information described under the headingRequirements for Requests for Extensions to December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard.

Requirements for Requests for Extensions to December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard

Any request for an extension to December 31, 2013, of the deadline for Indicator (b)(1), (c)(11), or (c)(12), as well as any request to use the alternative standard for Indicator (c)(11), must be submitted and signed by both the Governor and the Chief State School Officer. Further, an extension request or a request to use the alternative standard must be submitted by February 17, 2012, unless the Department permits a State to submit a request at a later date. The additional requirements for these requests are as follows:

A. Indicator (b)(1) Extension Requests

To receive an extension of the deadline for developing and implementing an SLDS that includes the 12 elements required by the America COMPETES Act under Indicator (b)(1), a State must provide the following information:

(1) An identification of the elements in the America COMPETES Act that the State has implemented to date as part of its SLDS.

(2) An assurance signed by the Governor and the Chief State School Officer that the State will—

(i) Incorporate the remaining elements into its SLDS by the December 31, 2013, deadline; and

(ii) Provide, within 60 days of submission of the request, a revised plan for incorporating those elements by the deadline.

B. Indicator (c)(11) Extension Requests

To receive an extension of the deadline for collecting and publicly reporting under Indicator (c)(11) student enrollment data for high school graduates who enroll in an in-state public IHE, a State must provide the following information:

(1) A description of the State's current capacity to collect and publicly report such student enrollment data.

(2) An assurance signed by the Governor and the Chief State School Officer that the State will—

(i)(A) Collect and publicly report by December 31, 2013, student enrollment data for high school graduates who attend an in-state public IHE; or

(B) Develop the capacity to collect and publicly report those data by December 31, 2013; and

(ii) Provide, within 60 days of submission of the request, a revised plan for how the State will—

(A) Collect and publicly report the data by December 31, 2013; or

(B) Develop the capacity to collect and publicly report those data by December 31, 2013.

C. Indicator (c)(12) Extension Requests

A State must provide the following information when requesting an extension of the deadline for collecting and publicly reporting under Indicator (c)(12) course completion data for high school graduates who enroll in an in-state public IHE:

(1) A description of the State's current capacity to collect and publicly report such course completion data.

(2) An assurance signed by the Governor and the Chief State School Officer that the State will—

(i)(A) Collect and publicly report, by December 31, 2013, course completion data required Indicator (c)(12) for high school graduates who attend an in-state public IHE; or

(B) Develop the capacity to collect and publicly report, by December 31, 2013, such data; and

(ii) Provide, within 60 days of submission of the request, a revised plan for how the State will—

(A) Collect and publicly report the data by December 31, 2012; or

(B) Develop the capacity to collect and publicly report such data by December 31, 2013.

D. Indicator (c)(11) Alternative Standard Requests

A State must provide the following information when requesting permission to use the alternative standard to satisfy the Indicator (c)(11) requirements to collect and publicly report student enrollment data for high school graduates who enroll in private or out-of-state public IHEs:

(1) A description of the State's current capacity to collect and publicly report such student enrollment data.

(2) An assurance signed by the Governor and the Chief State School Officer that the State will—

(i)(A) Collect and publicly report, by December 31, 2013, student enrollment data for high school graduates who enroll in in-state private, out-of-state private, or out-of-state public IHEs; or

(B) Increase its current capacity to collect and publicly report such data by December 31, 2013, and, by that date, publicly report, the following—

(1) For each in-state private IHE—

(a) Whether the State provides funding to the IHE;

(b) Whether the State has a data-sharing agreement in place with the IHE and, if so, whether the data-sharing agreement enables the State to track its recent high school graduates; and

(2) For each out-of-state private or out-of-state public IHE with which the State has a data-sharing agreement, individually or through a State agency or consortium—

(a) Whether the State provides funding to the IHE; and

(b) Whether the data-sharing agreement enables the State to track its recent high school graduates;

(ii) Provide, within 60 days of submission of the request, a revised plan for how the State will—

(A) Collect and publicly report the data by December 31, 2012; or

(B) Increase its current capacity to collect and report those data by December 31, 2013.

Requirements for Revised Plans for Indicator (b)(1), (c)(11), or (c)(12)

The revised plans for Indicator (b)(1), (c)(11), or (c)(12) must include the following information:

(a) A detailed description of the steps that the State will take to ensure that the requirements of the indicator will be met by December 31, 2013, including a reasonable timeline for those actions.

(b) Identification of the agency or agencies in the State responsible for the development and implementation of the revised plan.

(c) An overall budget, including the funding sources, that is sufficient to support the development and implementation of the revised plan.

Final Priority:

This notice contains one priority.

Priority—Developing and Implementing a Statewide Longitudinal Data System That Includes the 12 Required Elements

Priority:The Secretary gives priority to a State that has met the requirements of SFSF Indicator (b)(1) on or before the applicable deadline.

Types of Priorities:

When inviting applications for a competition using one or more priorities, we designate the type of each priority as absolute, competitive preference, or invitational through a notice in theFederal Register.The effect of each type of priority follows:

Absolute priority:Under an absolute priority, we consider only applications that meet the priority (34 CFR 75.105(c)(3)).

Competitive preference priority:Under a competitive preference priority, we give competitive preference to an application by (1) awarding additional points, depending on the extent to which the application meets the priority (34 CFR 75.105(c)(2)(i)); or (2) selecting an application that meets the priority over an application of comparable merit that does not meet the priority (34 CFR 75.105(c)(2)(ii)).

Invitational priority:Under an invitational priority, we are particularly interested in applications that meet the priority. However, we do not give an application that meets the priority a preference over other applications (34 CFR 75.105(c)(1)).

Authority To Take Enforcement Action Against SEAs

If a State receives an extension of a deadline to December 31, 2013, or the authority to use the alternative standard for Indicator (c)(11) but fails to meet the extended deadline or alternative standard, the Department may take enforcement actions against the SEA, including designation as high risk. In such instances, the Department may also elect not to award funds in a future discretionary grant competition to the SEA.

The Department will take into account the specific circumstances of the grantee and the severity of the non-compliance.

Note:

This notice does not solicit applications. In any year in which we choose to use the priority proposed in this notice, we invite applications through a notice in theFederal Register.

Executive Orders 12866 and 13563:

Regulatory Impact Analysis

Under Executive Order 12866, the Secretary must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—

(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or Tribal governments or communities in a material way (also referred to as an “economically significant” rule);

(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or

(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.

It has been determined that this regulatory action is a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.

We have also reviewed these regulations under Executive Order13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—

(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);

(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;

(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);

(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and

(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.

Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”

We are issuing these final revisions only on a reasoned determination that their benefits justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that maximize net benefits. Based on the analysis that follows, the Department believes that these final revisions are consistent with the principles in Executive Order 13563.

We have also determined that this regulatory action will not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.

In accordance with both Executive orders, the Department has assessed the potential costs and benefits of this regulatory action. The potential costs associated with this regulatory action are those resulting from statutory requirements and those we have determined as necessary for administering the Department's programs and activities. In this regulatory impact analysis, we discuss the need for regulatory action, the regulatory alternatives we considered, and the potential costs and benefits of the action.

Need for Federal Regulatory Action:

The revisions in this notice are the result of a regulatory review1of the SFSF requirements established in the November 2009 Notice and also a response to concerns raised by States regarding their capacity to implement those requirements fully. The revisions eliminate requirements that have been identified through the regulatory review as overly burdensome or unnecessary for the achievement of the intended purposes of the SFSF program. The revisions also modify requirements that have been identified by certain States as not feasible to meet by the currently established deadline, by extending the deadline for establishing compliance or providing an alternative compliance standard for States that seek that flexibility. The Secretary believes that these revisions are needed in order for the Department to administer the SFSF program in a manner that enables States to provide sufficient transparency on the extent to which they are implementing education reform actions consistent with the assurances provided in their SFSF applications while affording them an appropriate amount of time and flexibility to implement those actions. The Secretary further believes that this notice's requirements for requesting an extension of the deadline for Indicator (b)(1), (c)(11), or (c)(12) or using the Indicator (c)(11) alternative standard, as well as the requirements for revising plans for those indicators, are necessary to ensure that States' actions are consistent with the requirements for those indicators.

1As discussed elsewhere in this notice, the regulatory review was conducted in response to the January 18, 2011 Executive Order 13563 entitled “Improving Regulation and Regulatory Review” and the February 28, 2011 Memorandum from the President to executive departments and agencies entitled “Administrative Flexibility, Lower Costs, and Better Results for State, Local, and Tribal Governments.”

Regulatory Alternatives Considered:

An alternative to promulgation of the revisions in this notice would be to take no regulatory action and, instead, take enforcement action, such as recovering or withholding Department funds or establishing compliance agreements, against States that fail to comply with the relevant SFSF requirements established in the November 2009 Notice. In general, the Secretary believes that the latter approach would unfairly punish States that the Department believes, based on available information on implementation of SFSF plans, are making a good-faith effort to fully develop their statewide longitudinal data systems and their capacity to collect and report data on student postsecondary enrollment and persistence, but need more time to comply with the SFSF requirements. That said, the Secretary believes that States must fully develop statewide longitudinal data systems and may place on high-risk status those States that fail to comply with the requirements of Indicator (b)(1) by the current or (if approved for the State) extended deadline.

With respect to Indicator (c)(11), the Department considered proposing only an extension of the deadline for collecting and reporting student enrollment data for high school graduates who attend IHEs, but concluded that extending the deadline for the public, in-state IHEs and providing additional flexibility with the alternative standard for collecting and publicly reporting student enrollment data for high school graduates who attend private and out-of-state public IHEs better addresses the capacity concerns raised by States.

Summary of Costs and Benefits:

Revisions to SFSF Indicator Requirements:

In the November 2009 Notice, the Department provided detailed estimates of the costs to States, LEAs, and IHEs of complying with the SFSF requirements. We have assessed the potential costs and benefits of the revisions to those requirements in this notice and determined that they impose no net additional costs to States, LEAs, or IHEs.

On the contrary, the revisions will produce potential net cost savings.2For instance, the exemption for certain States from the reporting requirements under Descriptors (a)(1) and (a)(2) and Indicators (a)(3) through (a)(7) and the elimination of the annual reporting requirements for Indicators (c)(1) through (c)(9) and (d)(1) through (d)(6) confer savings by reducing collection and reporting burden on States and LEAs. Although it confers some new cost (as discussed in more detail later in this section), the Indicator (c)(11) alternative standard confers net savings to States using the standard (and to affected LEAs and IHEs) by no longerrequiring that those States, at a minimum, fully develop the capacity to collect and report, by September 30, 2011, enrollment data for high school graduates who enroll in private or out-of-state public IHEs. The extensions of the compliance deadlines for Indicators (b)(1), (c)(11), and (c)(12) will not add to the costs of complying with the associated requirements and might result in marginal savings (calculated on a present-value basis) as States will be able to spread the compliance costs over a longer period of time.

2We have not provided estimates of potential cost savings in this notice because we cannot reasonably estimate the amount of funds States have already spent to meet the applicable SFSF requirements.

Apart from potential cost savings, the benefits of the revisions are, as discussed elsewhere in this notice, simplified and more streamlined SFSF requirements that still provide the Department and the public with useful information on whether States are implementing education reforms that are consistent with the statutorily required assurances.

States using the Indicator (c)(11) alternative standard will incur minimal new costs. Under the standard, a State must publicly report, by December 31, 2013, information on the extent to which it has data-sharing agreements with private and out-of-state public IHEs that enable the State to track its recent high school graduates and demonstrate certain concrete steps it has taken to increase its capacity to track its high school graduates who enrolled in private and out-of-state public IHEs. We estimate that a State will need, on average, 40 hours to collect and report this information. At $30 per hour, the average cost of doing so is an estimated $1,200.

Based on information available from States on implementation of their SFSF plans, we estimate that 43 States will request use of the Indicator (c)(11) alternative standard. The total estimated cost to States for complying with the Indicator (c)(11) alternative standard reporting requirements is accordingly $51,600 ($1,200 times 43 States).

Requirements for Requests for Extensions of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard, and Requirements for Revised Plans for Indicator (b)(1), (c)(11), or (c)(12):

The costs for complying with these requirements will, in general, be minimal. Because States that do not meet the requirements associated with an SFSF indicator or descriptor were already required to submit a plan for achieving compliance that includes progress tracking and providing regular public progress reports, we do not believe that any new effort will be needed in order for a State to determine whether to request an extension of the deadline for Indicator (b)(1), (c)(11), or (c)(12) or use of the Indicator (c)(11) alternative standard.

In requesting a deadline extension or use of the alternative standard, a State must provide a description of its current capacity with respect to the applicable indicator and a signed assurance that it will comply with the revised requirements for the indicator and will submit its plan for doing so to the Department within 60 days of the request. The level of effort needed to meet these requirements is minimal. We estimate that a State will need, on average, eight hours to complete such a request. At $30 per hour, the average cost of completing a request is an estimated $240.

Based on information available from States on implementation of their SFSF plans, we estimate that 40 States will request an extension of the deadline for Indicator (b)(1), 43 States will request an extension of the deadline for Indicator (c)(11), 47 States will request an extension of the deadline for Indicator (c)(12), and 43 States will request use of the Indicator (c)(11) alternative standard. In total, States will complete an estimated 173 requests. At $240 per request, the total estimated cost to States for complying with the requirements for requests is $41,520 ($240 times 173 requests).

A State requesting a deadline extension or the use of the Indicator (c)(11) alternative standard must submit to the Department, within 60 days, a revised plan with respect to the applicable indicator that includes the specific steps the State will take to meet the revised requirements for the indicator, the budget for developing and implementing the revised plan, and the responsible agency or agencies. The cost of meeting these plan revision requirements should also be minimal. We estimate that a State will need, on average, eight hours to complete a plan revision consistent with the requirements. At $30 per hour, the average cost of completing a plan revision is an estimated $240.

As discussed above, States will complete an estimated 173 total requests for deadline extensions or for use of the Indicator (c)(11) alternative standard. Accordingly, we estimate that States will complete, at most, 173 plan revisions.3At $240 per revision, the total estimated cost to States for complying with the plan revision requirements is $41,520 ($240 per revision times 173 requests).

3A State requesting both an extension of the deadline for Indicator (c)(11) (as it applies to data on student enrollment in in-state public IHEs) and use of the alternative standard for that indicator (as it applies to data on student enrollment in private and out-of-state public IHEs) could address both of these requests in a single plan revision for the indicator. Consequently, the total number of completed plan revisions will almost certainly be lower than this estimate.

The total estimated cost for complying with the requirements for requests and for plan revisions is accordingly $83,040.

The November 2009 Notice detailed the cost of collecting and reporting the information and data associated with Indicators (b)(1), (c)(11), and (c)(12) on an annual basis. We expect that the cost of meeting these requirements will be reduced because most States have completed a substantial amount of the work related to collecting and reporting the required information. However, States requesting an extension of Indicator (b)(1), (c)(11), or (c)(12) will need to report the information and data for an additional year. We discuss the costs associated with reporting these indicators for an additional year below.

We estimate that, on average, a State will need one hour to collect and report the information associated with Indicator (b)(1). This is a one-hour reduction from the estimate in the November 2009 Notice because States have indicated that, on average, they have completed 50 percent of the work associated with collecting and reporting this information. Based on information available from States on implementation of their SFSF plans, we expect that 40 States will need to collect and report this information. At $30 per hour, the average cost for collecting and reporting this information is $30. The total estimated cost for complying with the Indicator (b)(1) reporting requirements is $1,200 ($30 per hour times 40 States).

As 9 States have already met the requirement for Indicator (c)(11), we expect that 43 States will need to collect and report the information associated with it, or provide evidence that they have developed the capacity to do so, for students who attend in-state, public IHEs. We estimate that, on average, a State will need 40 hours to meet this requirement. This is a reduction from the average hours per response in the November 2009 Notice because this estimate includes reporting only on students who attend in-state, public IHEs rather than all students enrolled in an IHE. The remaining students will be covered under the (c)(11) alternative standard. At $30 per hour, we estimate that the average cost of meeting this requirement is $1,200. The total estimated cost for States to comply with the requirements for Indicator (c)(11) is$51,600 ($1,200 per State times 43 States).

The 13,409 LEAs located in those 43 States will need to provide information associated with Indicator (c)(11). Based on an estimate of the total number of students enrolled in public IHEs in their home State,4and based on the assumption that LEAs can provide this information at a rate of 20 students per hour, we estimate that these LEAs will require a total of 84,584 hours to comply with the requirements for Indicator (c)(11) at a total cost of $2,114,597. Divided by the total number of affected LEAs, we estimate that each LEA will require 6.31 hours to provide this information. This is a reduction from the average hours per response in the November 2009 Notice because the current estimate relates only to students who attend in-state, public IHEs rather than to all students attending an IHE. Information on the remaining students will be covered under the (c)(11) alternative standard. At $25 per hour, the average cost per LEA of meeting the requirements of this Indicator is approximately $158.

4According to the Digest of Education Statistics, 2009, 2,240,414 first-time freshmen enrolled in public, degree-granting IHEs in fall 2008, which represented 74 percent of all first-time freshmen. Seehttp://nces.ed.gov/programs/digest/d09/tables/dt09_199.asp. Also in fall 2008, 2,109,931 freshmen who graduated from high school within the last 12 months attended degree-granting IHEs in their home State, which represented 81 percent of all freshmen. Seehttp://nces.ed.gov/programs/digest/d09/tables/dt09_223.asp. 1. An estimate of the number of first-time freshmen enrolled in public, degree-granting IHEs in their home State can be derived two ways. Applying the percentage of first-time freshmen attending public degree-granting IHEs to the number of first-time freshmen attending an IHE in their home State yields an estimate of 1,508,484, and applying the percentage of first-time freshmen attending an IHE in their home State to the number of first-time freshmen attending public degree-granting IHEs yields an estimate of 2,169,077. For the purposes of this estimate, the Department chooses the midpoint of these figures, which is 1,838,780. Applying the estimate (described earlier) that 94 percent of all first-time postsecondary students graduated from public schools, the Department estimates that 1,691,678 public high school graduates enroll in public degree-granting IHEs in their home State.

Again, based on our estimate of the total number of students enrolled in public IHEs in their home State and the assumption that IHEs can provide this information at a rate of 20 students per hour, we estimate that a total of 84,584 hours will be required for the 1,676 IHEs in the 43 affected States to respond to this requirement. On average, each IHE will need 50.47 hours to collect and report the information associated with Indicator (c)(11). This is an increase in the average hours per response in the November 2009 Notice because this estimate only relates to students who attend in-state public IHEs rather than all students attending an IHE. The remaining students will be covered under the (c)(11) alternative standard. The average burden per response increased from the burden estimated in the November 2009 Notice because the analysis now accounts for in-state public IHEs in the 43 States that have not yet met this requirement. Because 74 percent of freshmen attend in-state public IHEs, the burden in this notice is higher because it is no longer shared with private and out-of-state IHEs, which led to lower overall burden than we estimated for all IHEs in the November 2009 Notice. We expect that 1,676 IHEs will need to provide this information. At $25 per hour, the average cost per IHE for collecting and reporting this information is $1,261.75. The total estimated cost for IHEs to comply with the reporting requirements for Indicator (c)(11) is $2,114,597.

The total estimated cost for complying with the reporting requirements in Indicator (c)(11) is thus $4,280,794.

Based on information provided by the States, we expect that 47 States will need to collect and report the information associated with Indicator (c)(12). We estimate that, on average, a State will need 20 hours to collect and report the information. This represents a 20-hour reduction from our estimate in the November 2009 Notice because States have indicated that, on average, they have completed 50 percent of the work associated with this Indicator. At $30 per hour, the average cost for collecting and reporting this information is $600. The total estimated cost for States to comply with the reporting requirements for Indicator (c)(12) is $28,200 ($600 per State times 47 States).

The 1,555 IHEs located in these States must report information on the number of students who have completed at least one year's worth of college credit within two years of enrollment in the IHE. Based on data from the Digest of Education Statistics, we estimate that 1,140,855 first-time freshmen are enrolled in degree-granting in-state public IHEs in the 47 States that have not yet met this requirement. We estimate that IHEs can provide this information at a rate of 20 students per hour, which leads to approximately 57,043 hours of total effort across the affected IHEs at an estimated cost of $1,426,069. By dividing this total number of hours by the 1,555 public IHEs in the 47 States, we estimate that, on average, an IHE will need 36.68 hours to collect and report the information associated with Indicator (c)(12). This represents a reduction from the average hours per response that we estimated in the November 2009 Notice because some States with higher than average percentages of in-state students have already completed this work. We estimate a reduced average response time after excluding the IHEs from States that have completed the work from the calculation. At $25 per hour of IHE effort, we estimate that the average cost for collecting and reporting this information is $917 per IHE.

The total estimated cost for complying with the reporting requirements in Indicator (c)(12) is $1,454,269. The total estimated cost for complying with the collection and reporting requirements associated with Indicators (b)(1), (c)(11), and (c)(12) is accordingly $5,736,263.

The total estimated cost for complying with those collection and reporting requirements and the requirements in this notice is $5,870,903.

Regulatory Flexibility Act Certification:

The Secretary certifies that this regulatory action will not have a significant economic impact on a substantial number of small entities. The small entities that this regulatory action will affect are small LEAs receiving funds under this program and small IHEs.

This regulatory action will not have a significant economic impact on small LEAs because they will be able to meet the costs of compliance with this regulatory action using the funds provided under this program.

With respect to small IHEs, the U.S. Small Business Administration Size Standards define these institutions as “small entities” if they are for-profit or nonprofit institutions with total annual revenue below $5,000,000 or if they are institutions controlled by small governmental jurisdictions, which are comprised of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than 50,000. Based on data from the Department's Integrated Postsecondary Education Data System (IPEDS), up to 427 small IHEs with revenues of less than $5 million may be affected by these requirements; only 33 of these IHEs are public. The small IHEs represent only 13 percent of degree-granting IHEs. In addition, only 98,032 students (0.5 percent) enrolled in degree-granting IHEs in fall 2007 attended these small institutions; just 11,830 of these students are enrolled in small, degree-granting public IHEs. As the burden for indicators (c)(11) and (c)(12) is driven by the number of students for whom IHEs will be required to submit data, small IHEs will require significantly less effort to adhere to these requirementsthan will be the case for larger IHEs. Based on IPEDS data, the Department estimates that 1,873 of these students are first-time freshmen. As stated earlier in theSummary of Costs and Benefitssection of this notice, the Department estimates that, as required by indicator (c)(11), IHEs will be able to confirm the enrollment of 20 first-time freshmen per hour. Applying this estimate to the estimated number of first-time freshmen at small IHEs, the Department estimates that these IHEs will need to spend 94 hours to respond to this requirement at a total cost of $2,350 (assuming a cost of $25 per hour).

The effort involved in reporting the number of students enrolling in a public IHE in their home State who complete at least one year's worth of college credit applicable toward a degree within two years as required by indicator (c)(12) will also apply to small IHEs, but will be limited to students who enroll in public IHEs in their home State. As discussed earlier in theSummary of Costs and Benefitssection of this notice, the Department estimates that 81 percent of first-time freshmen who graduate from public high schools enroll in degree-granting IHEs in their home State. Applying this percentage to the estimated number of first-time freshmen enrolled in small public IHEs (1,873), the Department estimates that small IHEs will be required to report credit completion data for a total of 1,517 students. For this requirement, the Department also estimates that IHEs will be able to report the credit completion status of 20 first-time freshmen per hour. Again, applying this data entry rate to the estimated number of first-time freshmen at small public IHEs in their home State, the Department estimates that these IHEs will need to spend 76 hours to respond to this requirement at a total cost of $1,900. The total cost of these requirements for small IHEs is, therefore, $4,250; $2,068 of this cost will be borne by small private IHEs, and $2,182 of the cost will be borne by small public IHEs. Based on the total number of small IHEs across the Nation, the estimated cost per small private IHE is approximately $10, and the estimated cost per small public IHE is $66. The Department has, therefore, determined that the requirements will not represent a significant burden on small not-for-profit IHEs.

In addition, the Department believes the benefits provided under this regulatory action will outweigh the burdens on these institutions of complying with the requirements. One of these benefits will be the provision of better information on student success in postsecondary education to policymakers, educators, parents, and other stakeholders. The Department believes that the information gathered and reported as a result of these requirements will improve public accountability for performance; help States, LEAs, and schools learn from one another and improve their decision-making; and inform Federal policymaking.

A second major benefit is that better public information on State and local progress in the four reform areas will likely spur more rapid progress on those reforms, because States and LEAs that appear to be lagging in one area or another may see a need to redouble their efforts. The Department believes that more rapid progress on the essential educational reforms will have major benefits nationally, and that these reforms have the potential to drive dramatic improvements in student outcomes. The requirements that apply to IHEs should, in particular, spur more rapid implementation of pre-K-16 State longitudinal data systems.

Paperwork Reduction Act of 1995:

As part of its continuing effort to reduce paperwork and respondent burden, the Department conducts a preclearance consultation program to provide the general public and Federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)). This helps ensure that: the public understands the Department's collection instructions, respondents can provide the requested data in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the Department can properly assess the impact of collection requirements on respondents.

This notice of revisions contains information collection requirements previously approved under OMB control number 1810-0695.

A Federal agency cannot conduct or sponsor a collection of information unless OMB approves the collection under the PRA and the corresponding information collection instrument displays a currently valid OMB control number. Notwithstanding any other provision of law, no person is required to comply with, or is subject to penalty for failure to comply with, a collection of information if the collection instrument does not display a currently valid OMB control number.

Revisions to SFSF Indicator (c)(11) Requirements:

Under the Indicator (c)(11) alternative standard, a State must publicly report, by December 31, 2013, information on the extent to which it has data-sharing agreements with private and out-of-state public IHEs that enable the State to track its recent high school graduates. We estimate that a State will need, on average, 40 hours to collect and report this information.

Based on information available from States on implementation of their SFSF plans, we estimate that 43 States will request use of the Indicator (c)(11) alternative standard. The total estimated hours for States to comply with the Indicator (c)(11) alternative standard reporting requirements is accordingly an increase of 1,720 hours (40 hours per request times 43 requests) under collection 1810-0695.

Requirements for Requests for Extensions of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative Standard, and Requirements for Revised Plans for Indicators (b)(1), (c)(11), and (c)(12):

Because States that did not meet the requirements associated with an SFSF indicator or descriptor were required to submit a plan for achieving compliance that includes progress tracking and providing regular public progress reports, we do not believe that any new effort will be needed in order for a State to determine whether to request an extension of the deadline for Indicator (b)(1), (c)(11), or (c)(12) or use of the Indicator (c)(11) alternative standard.

In requesting a deadline extension or use of the alternative standard, a State must provide a description of its current capacity with respect to the applicable indicator and a signed assurance that it will comply with the revised requirements for the indicator and will submit its plan for doing so to the Department within 60 days of the request. The level of effort needed to meet these requirements should be minimal. We estimate that a State will need, on average, eight hours to complete such a request.

Based on information available from States on implementation of their SFSF plans, we estimate that 40 States will request an extension of the deadline for Indicator (b)(1), 43 States will request an extension of the deadline for Indicator (c)(11), 47 States will request an extension of the deadline for Indicator (c)(12), and 43 States will request use of the Indicator (c)(11) alternative standard. In total, States will complete an estimated 173 requests. The total estimated hours for States to comply with the requirements for requests is an increase of 1,384 hours (eight hours per request times 173 requests) under collection 1810-0695.

A State requesting a deadline extension or the use of the Indicator (c)(11) alternative standard will then be required to submit to the Department, within 60 days, a revised plan with respect to the applicable indicator that includes the specific steps the State will take to meet the revised requirements for the indicator, the budget for developing and implementing the revised plan, and the responsible agency or agencies. We estimate that a State will need, on average, eight hours to complete a plan revision consistent with the requirements.

As discussed above, States will complete an estimated 173 total requests for deadline extensions or for use of the Indicator (c)(11) alternative standard. Accordingly, we estimate that States will complete, at most, 173 plan revisions.5At eight hours per revision, the total estimated burden to States for complying with the plan revision requirements is an increase of 1,384 hours (eight hours per request times 173 requests) under collection 1810-0695.

5A State requesting both an extension of the deadline for Indicator (c)(11) (as it applies to data on student enrollment in in-state public IHEs) and use of the alternative standard for that indicator (as it applies to data on student enrollment in private and out-of-state public IHEs) could address both of these requests in a single plan revision for the indicator. Consequently, the total number of completed plan revisions will likely be lower than this estimate.

The total estimated burden for complying with the requirements for requests and for plan revisions is accordingly 2,768 hours.

After requesting an extension and providing a plan, a State must collect and report the information associated with Indicators (b)(1), (c)(11), and (c)(12) by December 31, 2013. Based on information available from States on implementation of their SFSF plan, we estimate that 40 States will need to report and collect the information associated with Indicator (b)(1). At an estimated one hour per collection and report, the total estimated burden to States is an increase of 40 hours (one hour per State times 40 States) under collection 1810-0695. The average response time of one hour per collection is a one-hour reduction from the estimates we provided in the November 2009 Notice because States have indicated that, on average, they have completed 50 percent of the work associated with reporting on this indicator.

As 9 States have already met the requirement for Indicator (c)(11), we expect that 43 States will need to collect and report the information associated with Indicator (c)(11), or provide evidence that they have developed the capacity to do so, for students who attend in-state, public IHEs. We estimate that, on average, a State will need 40 hours to meet this requirement. This is a reduction from the average hours per response that we estimated in the November 2009 Notice because the current estimate only relates to students who attend in-state, public IHEs rather than all students enrolled in an IHE. The remaining students will be covered under the (c)(11) alternative standard. The current estimate will equal a 1,720 hour (40 hours per State times 43 States) increase under collection 1810-0695.

The 13,409 LEAs located in those 43 States will need to provide information associated with Indicator (c)(11). Based on an estimate of the total number of students enrolled in public IHEs in their home State,6and based on the assumption that LEAs can provide this information at a rate of 20 students per hour, we estimate that these LEAs will require a total of 84,584 hours to comply with the requirements for Indicator (c)(11). Divided by the total number of affected LEAs, we estimate that each LEA will require 6.31 hours to provide this information. This will be a reduction from the average hours per response estimated in the November 2009 Notice because the current estimate only relates to students who attend in-state, public IHEs rather than all students attending an IHE. Information on the remaining students will be covered under the (c)(11) alternative standard.

6According to the Digest of Education Statistics, 2009, 2,240,414 first-time freshmen enrolled in public, degree-granting IHEs in fall 2008, which represented 74 percent of all first-time freshmen. Seehttp://nces.ed.gov/programs/digest/d09/tables/dt09_199.asp.Also in fall 2008, 2,109,931 freshmen who graduated from high school within the last 12 months attended degree-granting IHEs in their home State, which represented 81 percent of all freshmen. Seehttp://nces.ed.gov/programs/digest/d09/tables/dt09_223.asp.1. An estimate of the number of first-time freshmen enrolled in public, degree-granting IHEs in their home State can be derived two ways. Applying the percentage of first-time freshmen attending public degree-granting IHEs to the number of first-time freshmen attending an IHE in their home State yields an estimate of 1,508,484, and applying the percentage of first-time freshmen attending an IHE in their home State to the number of first-time freshmen attending public degree-granting IHEs yields an estimate of 2,169,077. For the purposes of this estimate, the Department chooses the midpoint of these figures, which is 1,838,780. Applying the estimate (described earlier) that 94 percent of all first-time postsecondary students graduated from public schools, the Department estimates that 1,691,678 public high school graduates enroll in public degree-granting IHEs in their home State.

Again, based on our estimate of the total number of students enrolled in public IHEs in their home State and the assumption that IHEs could provide this information at a rate of 20 students per hour, we estimate that a total of 84,584 hours will be required for the 1,676 IHEs in the 43 affected States to respond to this requirement. On average, each IHE will need 50.47 hours to provide the information associated with Indicator (c)(11). This is an increase in the average hours per response estimated in the November 2009 Notice because this estimate only relates to students who attend in-state public IHEs rather than all students attending an IHE. The remaining students will be covered under the (c)(11) alternative standard. The average burden per response increased from the burden estimated in the November 2009 Notice because the analysis now accounts for in-state public IHEs in the 43 States that have not yet met this requirement. Because 74 percent of freshmen attend in-state public IHEs, the burden under these revisions is higher because it is no longer shared with private and out-of-state IHEs, which led to an estimate of a lower overall burden for all IHEs in the November 2009 Notice. We expect that 1,676 IHEs will need to provide this information.

The total estimated hours for complying with the requirements of Indicator (c)(11) is 170,888.

We estimate that the State burden for collecting and reporting the information associated with Indicator (c)(12), or providing evidence that the State has developed the capacity to do so, will be approximately 20 hours per State. This is a 20-hour reduction from the estimates in the November 2009 Notice because States have indicated that they have, on average, completed 50 percent of the work for this Indicator. Based on information provided by the States, we expect that 47 States will need to provide this information. Accordingly, the total burden to States is an increase of 940 hours (20 hours per State times 47 States) under collection 1810-0695.

The 1,555 IHEs located in these States must report information on the number of students who have completed at least one year's worth of college credit within two years of enrollment in the IHE. Based on data from the Digest of Education Statistics, we estimate that 1,140,855 first-time freshmen are enrolled in degree-granting in-state public IHEs in the 47 States that have not yet met this requirement. We estimate that IHEs can provide this information at a rate of 20 students per hour, which leads to approximately 57,043 hours of total effort across the affected IHEs. By dividing the this total number of hours by the 1,555 public IHEs in the 47 States, we estimate that, on average, an IHE will need 36.68 hours to collect and report theinformation associated with Indicator (c)(12). The average hours per response is less than the estimate in the November 2009 Notice because some States with higher than average percentages of in-state students have already completed this work. Excluding the IHEs from these States from the calculations led to a reduced average response time.

The total estimated burden hours for complying with the collection and reporting requirements for Indicator (c)(12) is thus 57,983.

The estimated burden hours for complying with the collection and reporting requirements associated with the Indicator (c)(11) alternative standard is discussed above.

The total estimated burden hours for complying with the collection and reporting requirements associated with Indicators (b)(1), (c)(11) and (c)(12) is accordingly 228,911 hours.

The total estimated burden for complying with the requirements in this notice is an increase of 233,399 hours under collection 1810-0695.

Collection of InformationInformation collectionOMB Control number and estimated change in burden.This notice of revisions establishes an extension for collecting and reporting information associated with Indicators (b)(1), (c)(11), and (c)(12); an alternative standard for Indicator (c)(11); establishes requirements for requests for extensions of deadlines for Indicators (b)(1), (c)(11), and (c)(12); and establishes requirements for revised plans for Indicators (b)(1), (c)(11), and (c)(12)OMB 1810-0695. The burden will increase by 233,399 hours.

Assessment of Educational Impact:In the NPR and in accordance with section 411 of the General Education Provisions Act, 20 U.S.C. 1221e-4, we requested comments on whether the proposed requirements would require transmission of information that any other agency or authority of the United States gathers or makes available.

Based on the response to the NPR and on our review, we have determined that these final requirements do not require transmission of information that any other agency or authority of the United States gathers or makes available.

Intergovernmental Review:This program is subject to Executive Order 12372 and the regulations in 34 CFR part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism. The Executive order relies on processes developed by State and local governments for coordination and review of Federal financial assistance.

This document provides early notification of our specific plans and actions for this program.

Accessible Format:Individuals with disabilities can obtain this document in an accessible format (e.g., braille, large print, audiotape, or compact disc) on request to the program contact person listed underFOR FURTHER INFORMATION CONTACT.

Electronic Access to This Document:The official version of this document is the document published in theFederal Register.Free Internet access to the official edition of theFederal Registerand the Code of Federal Regulations is available via the Federal Digital System at:www.gpo.gov/fdsys.At this site you can view this document, as well as all other documents of this Department published in theFederal Register,in text or Adobe Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at the site.

You may also access documents of the Department published in theFederal Registerby using the article search feature at:www.federalregister.gov.Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department.

The Secretary of Education (Secretary) is adopting as a final requirement, without change, the interim final requirement for the State Fiscal Stabilization Fund (SFSF) program that extended to January 31, 2012, the deadline by which States must collect and publicly report data and other information on various SFSF indicators and descriptors.

If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

Background

On September 23, 2011, the Secretary published in theFederal Register(76 FR 59036) an interim final requirement extending, to January 31, 2012, the deadline for collecting and publicly reporting data and other information on various SFSF indicators and descriptors. The interim final requirement became effective on the date of its publication in theFederal Register.At the time the interim final requirement was published, the Secretary requested public comment on whether an extension of the SFSF deadline to January 31, 2012, was warranted.

As explained in the Summary section of the interim final requirement, the Secretary extended the deadline in response to the many challenges and competing priorities that States were facing in meeting the SFSF data collection and reporting requirements by the original September 30, 2011, deadline.

There are no differences between the interim final requirement and this final requirement.

Public Comment

In response to our request for public comments on the interim final requirement, two parties submitted comments. Specifically, two States commented on the efficacy of collecting student enrollment data to meet the requirements of SFSF Indicator (c)(11) and the Department's failure, in those States' view, to indicate that a specific third-party postsecondary data-matching company could be used to meet those requirements. These comments do not relate to the deadline extension established in the interim final requirement nor do they address the further extensions proposed in a separate SFSF notice that was published in theFederal Registeron the same day as the interim final requirement (i.e., the notice of proposed revisions to certain data collection and reporting requirements, and proposed priority (76 FR 59074) (notice of proposed revisions)). Because these comments are outside the scope of the interim final requirement and notice of proposed revisions, we do not discuss them further in this preamble.

Final Requirement

Each State must collect and publicly report data and other information on the SFSF indicators and descriptors by January 31, 2012.

Waiver of Delayed Effective Date

The Administrative Procedure Act (5 U.S.C. 553) requires that a substantive rule be published at least 30 days before its effective date, unless the rule grants or recognizes an exemption or relieves a restriction. (5 U.S.C. 553(d)(1)). Because we are granting States an extension of the September 30, 2011, deadline, the 30-day delayed effective date is not required. Accordingly, this final requirement is effective on the day it is published.

Executive Orders 12866 and 13563Regulatory Impact Analysis

Under Executive Order 12866, the Secretary must determine whether this regulatory action is significant and, therefore, subject to the requirements of the Executive order and review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines “significant regulatory action” as an action likely to result in a rule that may (1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or tribal governments or communities in a material way (also referred to as an economically significant rule); (2) create serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.

It has been determined that this regulatory action is significant under section 3(f)(4) of the Executive order.

We have also reviewed these regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—

(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);

(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;

(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);

(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and

(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.

Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”

We are issuing these regulations only on a reasoned determination that their benefits justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that maximize net benefits. Based on the analysis that follows, the Department believes that these regulations are consistent with the principles in Executive Order 13563.

Summary of Costs and Benefits

In accordance with both Executive orders, we have assessed the potential costs and benefits of the regulatory action to extend the current deadline by which a State must meet the requirements of the SFSF indicators and descriptors and have determined that the final requirement will not impose additional costs to grantees or the Federal government. Additionally, the Department has determined that this requirement does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.

Benefits

The extension of the deadline by which States have to collect and publicly report data and other information on various SFSF indicators and descriptors helps States to balance competing priorities without any additional cost to the grantees or Federal government.

Paperwork Reduction Act of 1995

As part of its continuing effort to reduce paperwork and respondent burden, the Department conducts a preclearance consultation program to provide the general public and Federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)). This helps ensure that: The public understands the Department's collection instructions; respondents can provide the requested data in the desired format; reporting burden (time and financial resources) is minimized; collection instruments are clearly understood; and the Department can properly assess the impact of collection requirements on respondents.

A Federal agency cannot conduct or sponsor a collection of information unless OMB approves the collection under the PRA and the corresponding information collection instrument displays a currently valid OMB control number. Notwithstanding any other provision of law, no person is required to comply with, or is subject to penalty for failure to comply with, a collection of information if the collection instrument does not display a currently valid OMB control number.

In the SFSF Phase 2 application, the Department established indicators and descriptors that required States to collect and publicly report data and other information. The Office of Management and Budget approved that information collection under an emergency review (OMB Control Number 1810-0695). The Department's authority under that information collection expired and the Department attained approval from OMB to reinstate the collection under the same control number, OMB Control Number 1810-0695. As stated in this preamble, we are extending the deadline from September 30, 2011, to January 31, 2012, for collecting and publicly reporting data and other information on various SFSF indicators and descriptors. Please note that the paperwork burden under OMB Control Number 1810-0695 is not due to, or changed by, the extension of the deadline date. For a full discussion of the paperwork burden under this control number, please see thePaperwork Reduction Act of 1995section in the interim final requirement published in theFederal Registeron September 23, 2011 (76 FR 59036, 59038).

Regulatory Flexibility Act Certification

The Secretary certifies that this regulatory action will not have a significant economic impact on a substantial number of small entities. Small entities will not incur any additional costs due to the extension of the deadline by which States have to collect and publicly report data and other information on various SFSF indicators and descriptors.

Accessible Format:Individuals with disabilities can obtain this document in an accessible format (e.g., braille, large print, audiotape, or compact disc) on request to the program contact person listed underFOR FURTHER INFORMATION CONTACT.

Electronic Access to This Document:The official version of this document is the document published in theFederal Register.Free Internet access to the official edition of theFederal Registerand the Code of Federal Regulations is available via the Federal Digital System at:www.gpo.gov/fdsys.At this site you can view this document, as well as all other documents of this Department published in theFederal Register,in text or Adobe Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at the site.

You may also access documents of the Department published in theFederal Registerby using the article search feature at:www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department.

Program Authority:

American Recovery and Reinvestment Act of 2009, Division A, Title XIV—State Fiscal Stabilization Fund, Public Law 111-5; 20 U.S.C. 1221e-3 and 3474.

The Department of Veterans Affairs (VA) amends existing regulations to reflect a new statutory authority to extend eligibility for burial in a national cemetery to include parents of certain veterans, as authorized by the Veterans' Benefits Act of 2010 (the Act), enacted on October 13, 2010. The Act authorizes the Secretary of Veterans Affairs to inter the biological or legally adoptive parents of a deceased veteran if the deceased veteran is a hostile casualty or dies from a training-related injury, is interred in a VA national cemetery in a gravesite with available space, and has no spouse or child who is buried, or surviving spouse or child who, upon death, may be eligible for burial, in a national cemetery.

DATES:

Effective Date:This rule is effective January 31, 2012.

Applicability Date:In accordance with section 502(e) of the Act, this amendment applies to parents who die on or after October 13, 2010, of veterans who die on or after October 7, 2001.

The goal of the National Cemetery Administration is to ensure that the burial needs of veterans and eligible family members are met by providing burial and memorialization in VA national cemeteries.

Subsection (a)(9) of 38 U.S.C. 2402, as added by section 502 of the Veterans' Benefits Act of 2010, authorizes the interment of parents of certain deceased veterans interred in VA national cemeteries, if the Secretary determines there is available space at the gravesite where the deceased veteran is interred. 38 U.S.C. 2402(a)(9); Public Law 111-275, sec. 502(b), 124 Stat. 2864, 2882 (Oct. 13, 2010). Authority to inter is limited to the biological or legally adoptive parents of a veteran who: (1) Is a “hostile casualty” or died from a “training-related injury”; (2) is interred in a VA national cemetery in a gravesite with available space; and (3) at the time of the parent's death has no spouse or child who is buried, or surviving spouse or child who, upon death, may be eligible for burial, in a VA national cemetery as the spouse, surviving spouse, or minor child of the veteran. For purposes of eligibility for burial in a national cemetery, the term “veteran” includes a person who died while in the active military, naval, or air service. 38 U.S.C. 2402(a)(1). Revision of 38 CFR 38.620 is necessary to reflect the new statutory authority for VA to inter qualifying parents of certain veterans in VA national cemeteries.

Under prior law, parents of veterans were not eligible for burial at a VA national cemetery unless they had attained eligibility through military service or marriage. However, recognizing the unique burden on the surviving parents of fallen servicemembers, the Act provides burial eligibility to those parents whose unmarried veteran son or daughter dies due to combat or training-related injuries. The Act also recognizes that national cemeteries are national shrines to honor eligible veterans and that gravesites should not be taken from those who have earned the right to burial in a national cemetery by serving their country. The Act accomplishes both goals by limiting the circumstances under which a parent is eligible for burial.

First, burial eligibility is limited to the biological or legally adoptive parents of a deceased veteran. The Act defines a“parent” as “a biological father or a biological mother or, in the case of adoption, a father through adoption or a mother through adoption.” 38 U.S.C. 2402(b)(1). This definition is intended not only to limit the type of parents who may be buried within the gravesite, but also to limit the number of parents who may be eligible for this benefit.SeeH. Rpt. No. 111-324, at 9 (2009) (“The [House Committee on Veterans' Affairs] also intends that no more than two parents may be eligible for this benefit.”). A veteran can have only two biological parents who may be eligible for interment. In the case of adoption, an adoptive parent may be eligible for interment in the place of a biological parent but not in addition to a biological parent. Thus, we interpret the statute to limit eligibility for parental interment to no more than two qualifying deceased parents within the gravesite of their deceased veteran child.

Second, at the time of the parent's death, the deceased veteran must not have a spouse or child who is buried, or a surviving spouse or child who, upon death, may be eligible for burial, in a VA national cemetery based on that individual's relationship to the veteran.

Third, under the Act, the Secretary must determine that space is available at the veteran's gravesite for a parent of that veteran to be eligible for burial. The Act itself provides a parent with eligibility for burial only “if the Secretary determines that there is available space at the gravesite.” 38 U.S.C. 2402(a)(9)(A). Accordingly, the Act requires the Secretary to determine whether there is sufficient room at the particular gravesite to accommodate the burial of a parent. If space is available, then a parent may be eligible for burial, but if space is not available, then a parent is not eligible for burial.

Finally, for a parent of a deceased veteran to be eligible for burial in a national cemetery, the deceased veteran must meet the statutory definition of a “hostile casualty” or have died from a “training-related injury.” The Act defines the term “hostile casualty” as “a member of the Armed Forces [who] dies as the direct result of hostile action with the enemy, while in combat, while going to or returning from a combat mission if the cause of death was directly related to hostile action, or while hospitalized or undergoing treatment at the expense of the United States for injury incurred during combat, and includes a person killed mistakenly or accidentally by friendly fire directed at a hostile force or what is thought to be a hostile force.” 38 U.S.C. 2402(b)(2). The term “hostile casualty” does not include “a person who dies due to the elements, a self-inflicted wound, combat fatigue, or a friendly force while the person was in an absent-without-leave, deserter, or dropped-from-rolls status or was voluntarily absent from a place of duty.”Id.The Act defines the term “training-related injury” as “an injury incurred by a member of the Armed Forces while performing authorized training activities in preparation for a combat mission.” 38 U.S.C. 2402(b)(3). The provisions of section 502 of the Act apply only to a qualifying parent who dies on or after October 13, 2010, and whose veteran child is a “hostile casualty” or dies from a “training-related injury” on or after October 7, 2001. Public Law 111-275, sec. 502(e), 124 Stat. at 2883. The above-mentioned definitions have been incorporated into the regulatory text of this rule.

Administrative Procedure Act

The changes made by this final rule merely reflect statutory provisions or VA's interpretation of statutory requirements. The primary purpose of the amendment is to conform § 38.620 to the statute and implement VA's interpretation of 38 U.S.C. 2402(a)(9) and (b). Section 553(b) of title 5, U.S. Code, does not apply to restatement of statutory terms, nor to interpretive rules. Accordingly, there is a basis for dispensing with prior notice and opportunity to comment. Moreover, under section 553(d), such rules do not require 30 days prior notice before they may become effective. Therefore, there is a basis for dispensing with the delayed effective date provisions of 5 U.S.C. 553(d).

Executive Orders 12866 and 13563

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” which requires review by the Office of Management and Budget (OMB), as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

The economic, interagency, budgetary, legal, and policy implications of this final rule have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866.

Regulatory Flexibility Act

The Secretary hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This final rule will directly affect only individual beneficiaries and will not directly affect small entities. Therefore, pursuant to 5 U.S.C. 605(b), this final rule is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in an expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any year. This final rule would have no such effect on State, local, and tribal governments, or on the private sector.

Paperwork Reduction Act

This final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act (44 U.S.C. 3501-3520).

Catalog of Federal Domestic Assistance Program Number

The Catalog of Federal Domestic Assistance program number for this document is 64.201, National Cemeteries.

Signing Authority

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign andsubmit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. John R. Gingrich, Chief of Staff, Department of Veterans Affairs, approved this document on January 4, 2012, for publication.

(i)(1) Any biological or legally adoptive parent who dies on or after October 13, 2010, and whose deceased child:

(i) Is a veteran who dies on or after October 7, 2001, and

(A) Except as provided in paragraph (i)(2) of this section, dies as the direct result of hostile action with the enemy, while in combat, while in transit to or from a combat mission if the cause of death is directly related to hostile action, or while hospitalized or undergoing treatment at the expense of the United States for injury incurred during combat; or

(B) Is killed mistakenly or accidentally by friendly fire that was directed at a hostile force or what was thought to be a hostile force; or

(C) Died from a training-related injury while performing authorized training activities in preparation for a combat mission;

(ii) Is interred in a national cemetery; and

(iii) Has no spouse or child who is buried, or surviving spouse or child who, upon death, may be eligible for burial, in a national cemetery under paragraph (e) of this section.

(2) A parent is not eligible for burial if the veteran dies due to the elements, a self-inflicted wound, combat fatigue, or a friendly force while the veteran was in an absent-without-leave, deserter, or dropped-from-rolls status or was voluntarily absent from a place of duty.

(3)(i) A parent may be buried only within the veteran child's gravesite.

(ii) No more than two parents are eligible for burial per deceased veteran child.

(4) Parent burial eligibility is subject to a determination by the Secretary that there is available space within the veteran's gravesite.

EPA is taking final action to make nonconformance penalties (NCPs) available to manufacturers of heavy heavy-duty diesel engines in model years 2012 and 2013 for emissions of oxides of nitrogen (NOX). In general, the availability of NCPs allows a manufacturer of heavy-duty engines (HDEs) whose engines fail to conform to specified applicable emission standards, but do not exceed a designated upper limit, to be issued a certificate of conformity upon payment of a monetary penalty to the United States Government. The upper limit associated with these NCPs is 0.50 grams of NOXper horsepower-hour.

DATES:

This rule is effective January 31, 2012. We will accept comments on this interim final rule until April 4, 2012.

ADDRESSES:

Submit your comments, to Docket EPA-HQ-OAR-2011-1000, by one of the following methods:http://www.regulations.gov:Follow the on-line instructions for submitting comments.

Docket:All documents in the docket are listed in thehttp://www.regulations.govindex. Although listed in the index, some information is not publicly available,e.g.,confidential business information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy in the docket. Publicly available docket materials are available either electronically inhttp://www.regulations.govor in hard copy at the following locations:

EPA:EPA Docket Center, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave. NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Air Docket is (202) 566-1742.

This action affects you if you produce or import new heavy heavy-duty diesel engines which are intended for use in highway vehicles such as trucks and buses or heavy-duty highway vehicles. The table below gives some examples of entities that may be affected by these regulations. But because these are only examples, you should carefully examine the regulations in 40 CFR part 86. If you have questions, call the person listed in theFOR FURTHER INFORMATION CONTACTsection above.

Engine and truck manufacturers.aNorth American Industry Classification System (NAICS).Table of ContentsI. Statutory Authority and Regulatory BackgroundA. Statutory AuthorityB. Background Regarding Nonconformance Penalty RulesC. 2007 and 2010 NOXStandardsII. Justification for This Interim Final RuleIII. Notice of Proposed RulemakingIV. Nonconformance Penalties for 2012 and Later Heavy-Duty Engines and Heavy-Duty VehiclesA. NCP Eligibility: Emission Standards for Which NCPs Are Being Established in This Interim Final RuleB. NCP Eligibility: Emission Standards for Which We Are Not Establishing NCPs in This Interim Final RuleV. Penalty RatesA. ParametersVI. Economic ImpactVII. Environmental ImpactVIII. Public ParticipationIX. Statutory and Executive Order ReviewsA. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory ReviewB. Paperwork Reduction ActC. Regulatory Flexibility ActD. Unfunded Mandates Reform ActE. Executive Order 13132 (Federalism)F. Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments)G. Executive Order 13045: “Protection of Children From Environmental Health Risks and Safety Risks”H. Executive Order 13211 (Energy Effects)I. National Technology Transfer Advancement ActJ. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income PopulationsK. Congressional Review ActX. Statutory Provisions and Legal AuthorityI. Statutory Authority and Regulatory BackgroundA. Statutory Authority

Section 206(g) of the Clean Air Act (the Act), 42 U.S.C. 7525(g), allows EPA to promulgate regulations permitting manufacturers of heavy-duty engines (HDEs) or heavy-duty vehicles (HDVs) to receive a certificate of conformity for HDEs or HDVs that exceed a federal emissions standard, but do not exceed an upper limit associated with that standard, if the manufacturer pays a nonconformance penalty (NCP) established by rulemaking. Congress adopted section 206(g) in the Clean Air Act Amendments of 1977 as a response to a concern with requiring technology-forcing emissions standards for heavy-duty engines. The concern was if strict technology-forcing standards were promulgated, then some manufacturers might be unable to comply initially and would be forced out of the marketplace. NCPs were intended to remedy this concern. The nonconforming manufacturers would have a temporary alternative that would permit them to sell their engines or vehicles by payment of a penalty. At the same time, conforming manufacturers would not suffer a competitive disadvantage compared to nonconforming manufacturers, because the NCPs would be based, in part, on money saved by the nonconforming manufacturer.

Under section 206(g)(1), NCPs may be offered for HDVs or HDEs. The penalty may vary by pollutant and by class or category of vehicle or engine. Section 206(g)(3) requires that NCPs:

• Account for the degree of emission nonconformity;

• Increase periodically to provide incentive for nonconforming manufacturers to achieve the emission standards; and

• Remove the competitive disadvantage to conforming manufacturers.

Section 206(g) authorizes EPA to require testing of production vehicles or engines in order to determine the emission level upon which the penalty is based. If the emission level of a vehicle or engine exceeds an upper limit of nonconformity established by EPA through regulation, the vehicle or engine would not qualify for an NCP under section 206(g) and no certificate of conformity could be issued to the manufacturer. If the emission level is below the upper limit but above the standard, that emission level becomes the “compliance level,” which is also the benchmark for warranty and recall liability. The manufacturer who elects to pay the NCP is liable for vehicles or engines that exceed the compliance level in use. The manufacturer does not have in-use warranty or recall liability for emissions levels above the standard but below the compliance level.

B. Background Regarding Nonconformance Penalty Rules

Since the promulgation of the first NCP rule in 1985, subsequent NCP rules generally have been described as continuing “phases” of the initial NCP rule. The first NCP rule (Phase I), sometimes referred to as the “generic” NCP rule, established three basic criteria for determining the eligibility of emission standards for nonconformance penalties in any given model year (50 FR 35374, August 30, 1985). As described in section IV.A.(1) of this Interim Final Rule, we have determined that these criteria have been met for one manufacturer. (For regulatory language, see 40 CFR 86.1103-87.) The first criterion is that the emission standard in question must become more difficult to meet. This can occur in two ways, either by the emission standard itself becoming more stringent, or due to its interaction with another emission standard that has become more stringent. Second, substantial work must be required in order to meet the emission standard. EPA considers “substantial work” to mean the application of technology not previously used in that vehicle or engine class/subclass, or a significant modification of existing technology, in order to bring that vehicle/engine into compliance. EPA does not consider minor modifications or calibration changes to be classified as substantial work. Third, EPA must find that a manufacturer is likely to be noncomplying for technological reasons (referred to in earlier rules as a “technological laggard”). Prior NCP rules have considered such a technological laggard to be a manufacturer who cannot meet a particular emission standard due to technological (not economic) difficulties and who, in the absence of NCPs, might be forced from the marketplace. As described in section IV.A.(1) of this Interim Final Rule, we have determined that this criterion has been met for one manufacturer. This manufacturer notified us late in 2011 that it would not have enough emission credits for its model year 2012 heavy heavy-duty engines.

The criteria and methodologies established in the 1985 NCP rule have since been used to determine eligibility and to establish NCPs for a number of heavy-duty emission standards. Phases II, III, IV, V, and VI published in the period from 1985 to 2002, established NCPs that, in combination, cover the full range of heavy-duty—from heavy light-duty trucks (6,000-8,500 pounds gross vehicle weight) to the largest diesel truck and urban bus engines. NCPs have been established for hydrocarbons (HC), carbon monoxide (CO), nitrogen oxides (NOX), and particulate matter (PM). The most recent NCP rule (67 FR 51464, August 8, 2002) established NCPs for the 2004 and later model year NOXstandard for heavy-duty diesel engines (HDDEs). The NCP rulemaking phases are summarized in greater detail in the Interim and Proposed Technical Support Document for this rulemaking.

C. 2007 and 2010 NOXStandards

The 0.20 g/hp-hr NOXstandard that applies for current and future heavy-duty engines was adopted January 18, 2001 (66 FR 5001), and first applied in the 2007 model year. However, because of phase-in provisions adopted in thatrule and use of emission credits generated by manufacturers for early compliance, manufacturers have been able to continue to produce engines with NOXemissions greater than 0.20 g/hp-hr. The phase-in provisions ended after model year 2009 so that the 0.20 g/hp-hr NOXstandard was fully phased-in for model year 2010. Equally important, the cap applicable to Family Emission Limits (FELs)1for credit using engine families was lowered to 0.50 g/hp-hr beginning in model year 2010. Because of these changes that occurred in model year 2010, the 0.20 g/hp-hr NOXemission standard is often referred to as the 2010 NOXemission standard, even though it applied to engines as early as model year 2007.

1FELs are emission levels specified by the manufacturer that serve as the applicable emission standard for engines participating in the emission averaging program. The FEL cap is the highest FEL to which a manufacturer may certify an engine using emission credits.

While some manufacturers retain NOXemission credits that currently allow them to produce engines with NOXemissions as high as 0.50 g/hp-hr, we expect that one of these manufacturers could exhaust its supply of heavy heavy-duty engine NOXcredits as early as this year.

II. Justification for This Interim Final Rule

EPA is taking this action as an interim final rule without prior proposal and public comment because EPA finds for good cause under section 553(b)(B) of the Administrative Procedure Act (APA), 5 U.S.C. 551et seq.that notice-and-comment are impracticable, unnecessary or contrary to the public interest in this instance. Section 307(d) of the CAA states that in the case of any rule to which section 307(d) applies, notice of proposed rulemaking must be published in theFederal Register(CAA § 307(d)(3)). The promulgation or revision of regulations under section 206 of the CAA is generally subject to section 307(d). However, section 307(d) does not apply to any rule referred to in subparagraphs (A) or (B) of section 553(b) of the APA.

In reaching this determination, EPA considered several factors: (1) Taking interim final action avoids the possibility of an engine manufacturer from being unable to certify a complete product line of engines for model year 2012 and/or 2013; (2) the Agency is only amending limited provisions in existing NCP regulations in 40 CFR part 86; (3) the rule's duration is limited (see,e.g., Small Refiner Lead Phase-Down Task Forcev.EPA,705 F.2d 506 (D.C. Cir. 1983)); and (4) there is no risk to the public interest in allowing manufacturers to certify using NCPs before the point at which EPA could make them available through a full notice-and-comment rulemaking.

EPA is promulgating NCPs for heavy heavy-duty diesel engines in this Interim Final Rule because we have concluded that there is a significant likelihood that they will be needed during the 2012 model year. One manufacturer is currently using NOXcredits to certify all of its heavy heavy-duty diesel engines at nearly 0.50 g/hp-hr. Based on its current credit balance and projected sales for this service class, we do not expect this manufacturer to have sufficient credits to cover its entire model year 2012 production. Since we have not certified any of this manufacturer's model year 2012 heavy heavy-duty diesel engines without the need for emission credits, we believe it is possible that it may need NCPs during this model year. We have concluded that the very earliest we could make NCPs available through a full notice-and-comment rulemaking, would be late in model year 2012, which would likely be after the manufacturer's credit supply has been depleted. Thus, making NCPs available through this Interim Final Rule is the only way to ensure that the manufacturer's depletion of its NOXcredits will not force it to cease production of heavy heavy-duty engines this year.

The second reason for invoking the good cause exemption is that EPA is establishing NCPs based on the existing regulatory provisions in 40 CFR part 86, subpart L, and is only adding new penalty parameters to reflect the costs of compliance specific to the 2010 NOXstandard. In this Interim Final Rule, EPA is not revisiting the regulatory provisions that specify how to calculate penalties from the penalty parameters, how to determine a compliance level, or how to report to EPA. Since these provisions have been established through notice-and-comment rulemaking several times before, interested parties have had opportunity to comment on them. Thus, it is unnecessary to provide an additional opportunity to comment prior to issuing this interim final rule.

Third, at most, this interim final rule will address only heavy heavy-duty engines in model years 2012 and 2013, and by its own terms is applicable for less than two calendar years. It is thus limited in duration. EPA is publishing a parallel notice of proposed rulemaking simultaneously with this rule and EPA intends to take appropriate final action on that rule as soon as possible. With due consideration to comments, the interim NCPs being established in this IFR will cease to be applicable once the follow up Final Rule is effective.

Finally, it is important to note that NCPs are set at a level that is intended to ensure that manufacturers only use them when there is no other path to certification. Thus, should EPA be incorrect in its projection that NCPs will be needed during model year 2012, the fact that they will be available on an interim basis will have no practical significance because manufacturers will not use them.

For the reasons explained above, EPA finds that this constitutes good cause under 5 U.S.C. 553(b)(B). Nonetheless, EPA is providing until April 4, 2012 for submission of public comments following this action. EPA will consider all written comments submitted in the allotted time period in the context of the accompanying notice of proposed rulemaking.

Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C. chapter 5, generally provides that rules may not take effect earlier than 30 days after they are published in theFederal Register. APA section 553(d) excepts from this provision any action that grants or recognizes an exemption or relieves a restriction. Since today's action can be considered to either effectively grant an exemption from meeting the current applicable NOXemission standard or relieve a restriction that would otherwise prevent a manufacturer from certifying, EPA is making this action effective immediately upon publication.

III. Notice of Proposed Rulemaking

EPA is also simultaneously publishing a parallel Notice of Proposed Rulemaking (NPRM) addressing NCPs for heavy-duty engines. Among other things, that NPRM seeks comment on NCPs for model year 2012 and later heavy heavy-duty diesel engines, as well as for medium heavy-duty diesel engines. The NCPs in the Final Rule for that NPRM will eventually supersede the NCPs being promulgated in this Interim Final Rule, especially for model year 2013 and later. For example, should the follow-up Final Rule be published by September 14, 2012, it would likely have an effective date of November 13, 2012. Should that Final Rule establish different NCPs for heavy heavy-duty engines, those new NCPs would be available for any engines produced on or after November 13, 2012, instead of the interim NCPs being finalized today.

Note that Docket Number EPA-HQ-OAR-2011-1000 is being used for both the Interim Final Rule and the parallel NPRM.

IV. Nonconformance Penalties for 2012 and Later Heavy-Duty Engines and Heavy-Duty VehiclesA. NCP Eligibility: Emission Standards for Which NCPs Are Being Established in This Interim Final Rule(1) Heavy Heavy-Duty Diesel NOXStandard

As discussed in section I.B., EPA must determine that three criteria are met in order to determine that an NCP should be established in any given model year. For the 2010 NOXstandard, we believe these criteria have been met for heavy heavy-duty diesel engines, and it is therefore appropriate to establish NCPs for this standard for the current model year and later.

The first criterion requires that the emission standard in question must become more difficult to meet. This is the case with the 2010 NOXstandard. The previous emission standard for this category is a combined NMHC + NOXstandard of 2.4 g/hp-hr, or optionally a 2.5 g/hp-hr NMHC + NOXwith a limit of 0.5 g/hp-hr NMHC.2The 2010 (i.e.,current) standards are 0.20 g/hp-hr for NOXand 0.14 g/hp-hr for NMHC. When promulgated, the Agency concluded that the 0.20 g/hp-hr NOXstandard was a technology forcing standard. Second, all heavy heavy-duty diesel engines currently certified to the 0.20 g/hp-hr standard without using credits are using new aftertreatment systems to meet this standard.3It is therefore logical to conclude the standard is more difficult to meet and that substantial work was required to meet the emission standard.

2NMHC stands for non-methane hydrocarbons, which is a measure of total hydrocarbons with the methane emissions subtracted out. For typical on-highway diesel fueled heavy-duty engines, methane emissions are on the order of 10 percent of the total hydrocarbon emissions.

3For this notice, EPA describes those manufacturers that have achieved the 0.20 g/hp-hr emission standard as “conforming”, “compliant” or “complying” manufacturers, and those that have not as the “nonconforming”, “noncompliant” or “noncomplying” manufacturers. However, it is important to clarify that manufacturers certifying above the 0.20 g/hp-hr NOXemission standard using emission credits are in compliance with regulations as long as they have enough emission credits to offset their total NOXemissions above the standard.

Third, EPA is promulgating NCPs for heavy heavy-duty diesel engines because we have concluded that there is a significant likelihood that they will be needed by an engine manufacturer that has not yet met the requirements for technological reasons. One manufacturer is currently using NOXcredits to certify all of its heavy heavy-duty diesel engines at nearly the FEL cap level of 0.50 g/hp-hr. Based on its current credit balance and projected sales for this service class, we do not expect this manufacturer to have sufficient credits to cover its entire model year 2012 production. This manufacturer intends to use a different technology to meet the NOXstandard but has not yet submitted an application for the 2012 model year with NOXemissions at or below the 0.20 g/hp-hr standard. Since it has not yet submitted an application for certification for any model year 2012 heavy heavy-duty diesel engines that would not require emission credits, we believe it is a reasonable possibility that this manufacturer may not be able to comply for technological reasons with respect to the 2010 NOXstandards for heavy heavy-duty diesel engines in the 2012 and 2013 model years. This manufacturer notified us late in 2011 that it would not have enough emission credits for its model year 2012 heavy heavy-duty engines.

B. NCP Eligibility: Emission Standards for Which We Are Not Establishing NCPs in This Interim Final Rule

This section identifies the emission standards for which we are not establishing NCPs in this Interim Final Rule. Note that EPA is issuing a parallel Notice of Proposed Rulemaking (NPRM) proposing and/or seeking comment on NCPs for certain other emission standards.

(1) Light and Medium Heavy-Duty Diesel NOXStandards

EPA believes that the first two NCP criteria have been met for the 2010 NOXstandard for light and medium heavy-duty diesel engines. However, we have not determined that any manufacturer of light or medium heavy-duty diesel engines will be unable to certify to the 2010 NOXstandard for the 2012 and 2013 model years. We believe that any manufacturer unable to achieve 0.20 g/hp-hr will have sufficient NOXemission credits to continue certifying light heavy-duty and medium heavy-duty engines through the 2013 model year. (See the parallel NPRM.)

(2) Heavy-Duty Gasoline Engine Standards

In a final rule published on January 18, 2001 (66 FR 5001), EPA established more stringent emission standards for all heavy-duty gasoline (or “Otto-cycle”) vehicles and engines. These standards took two forms: A chassis-based set of standards for complete vehicles under 14,000 pounds GVWR (the chassis-based program), and an engine-based set of standards for all other Otto-cycle heavy-duty engines (the engine-based program). Each of the two programs has an associated averaging, banking, and trading (ABT) program. The new standards generally took effect starting with the 2008 model year, and all manufacturers are in compliance with them.

(3) Heavy-Duty Diesel Engine NMHC, CO, and PM Standards

EPA adopted new NMHC and PM for model year 2007 and later heavy-duty engines in the same rule that set the 2010 NOXemission standard (66 FR 5001, January 18, 2001). The CO standard was not changed. We are not considering NCPs for any of these other standards because all manufacturers are already fully compliant with them.

(4) Heavy-Duty CO2Standards

In a final rule published on September 15, 2011 (76 FR 57106), EPA established new CO2emission standards for all heavy-duty vehicles and engines. We are not considering NCPs for any of these standards at this time because we currently do not have a basis to conclude that a technological laggard is likely to develop.

We are adding a new regulatory provision related to these CO2emission standards. The provision prohibits generating CO2emission credits from engines paying NCPs for NOX. Given the general tradeoff between CO2and NOXemissions, we were concerned that a manufacturer capable of meeting the 0.20 g/hp-hr NOXemission standard could choose to pay an NCP in order to generate CO2credits by recalibrating its engines for higher NOXemissions and lower CO2. There are two reasons this would be inappropriate. First, emission credits are supposed to provide an incentive for a manufacturer to go beyond what is normally required to meet emission standards. However, allowing manufacturers to generate CO2credits while paying NCPs would actually create an incentive for manufacturers to do less than is required to meet the emission standards. Equally important, NCPs have always been intended for manufacturers that cannot meet an emission standard for technological reasons rather than manufacturers choosing not to comply.

V. Penalty Rates

This rulemaking is the most recent in a series of NCP rulemakings. These are referred to as Phases and are referenced below.4The discussions of penalty ratesin those rulemakings are incorporated by reference. This section briefly reviews the penalty rate formula originally promulgated in the Phase I rule (currently found at 40 CFR 86.1113-87) and discusses how EPA arrived at the penalty rates in this Interim Final Rule.

The penalty rates being established in this rule rely on the existing NCP regulatory structure. Thus, the only changes being made to the regulations are updates to the cost parameters to reflect the compliance costs for the 2010 standards, setting of the upper limit, and clarifying in § 86.1104-91 that EPA may set the upper limit at a level below the previous standard if we determine that the lower level is achievable by all engines.

Because these penalties are being adopted in an Interim Final Rule, we are limiting their applicability to model years 2012 and 2013. Prior to model year 2014, we will promulgate a Final Rule addressing NCPs following notice and comment. Note that we may promulgate the Final Rule as soon as later this calendar year, and as applicable, it would supersede the provisions of this Interim Final Rule after it becomes effective.

The NCP rates being adopted in this IFR are specified for model year 2012. As required by the Clean Air Act, the existing regulations include a formula that increases the penalty rates with each new model year. We will apply this annual adjustment formula to the NCPs by setting the 2012 model year as year number one. Traditionally, NCPs are available the first year of the new emission standard and that becomes year one for purposes of the annual escalator. However, EPA believes the 2012 model year is the correct year for the first year of the escalator calculation even though the NOXemission standard began in 2010.

A. Parameters

As in the previous NCP rules, we are specifying the NCP formula for each standard using the following parameters: COC50, COC90, MC50, F, and UL. The NCP formula is the same as that promulgated in the Phase I rule. As was done in previous NCP rules, costs consider additional manufacturer costs and additional owner costs, but do not consider certification costs because both complying and noncomplying manufacturers must incur certification costs. COC50is an estimate of the industry-wide average incremental cost per engine (references to engines are intended to include vehicles as well) associated with meeting the standard for which an NCP is offered, compared with meeting the upper limit. COC90is an estimate of the 90th percentile incremental cost per-engine associated with meeting the standard for which an NCP is offered, compared with meeting the associated upper limit. Conceptually, COC50represents costs for a typical or average manufacturer, while COC90represents costs for the manufacturers with the highest compliance costs.

MC50is an estimate of the industry-wide average marginal cost of compliance per unit of reduced pollutant associated with the least cost effective emission control technology installed to meet the new standard. MC50is measured in dollars per g/hp-hr for heavy-duty engines. F is a factor used to derive MC90, the 90th percentile marginal cost of compliance with the NCP standard for engines in the NCP category. MC90defines the slope of the penalty rate curve near the standard and is equal to MC50multiplied by F. UL is the upper limit above which no engine may be certified.

The derivation of the cost parameters is described in a support document entitled “Interim and Proposed Technical Support Document: Nonconformance Penalties for 2012 and later Highway Heavy-Duty Diesel Engines,” which is available in the public docket for this rulemaking. All costs are presented in 2011 dollars.

(1) Upper Limit

We are revising the regulations in § 86.1104-91 to clarify that EPA may set (during rulemaking) the upper limit at a level below the previous standard if we determine that the lower level is achievable by all engines. As described below, we are also establishing the upper limit for this NCP rule at 0.50 g/hp-hr. These are the only regulatory changes being made with respect to the upper limit.

The upper limit is the emission level established by regulation above which NCPs are not available and a heavy duty engine cannot be certified or introduced into commerce. CAA section 206(g)(2) refers to the upper limit as a percentage above the emission standard, set by regulation, that corresponds to an emission level EPA determines to be “practicable.” The upper limit is an important aspect of the NCP regulations not only because it establishes an emission level above which no engine may be certified, but it is also a critical component of the cost analysis used to develop the penalty rates. The regulations specify that the relevant costs for determining the COC50and the COC90factors are the difference between an engine at the upper limit and one that meets the applicable standards (see 40 CFR 86.1113-87).

The regulatory approach adopted under the prior NCP rules sets the default Upper Limit (UL) at the prior emission standard when a prior emission standard exists and is then changed to become more stringent. EPA concluded that the upper limit should be reasonably achievable by all manufacturers with vehicles in the relevant class. It should be within reach of all manufacturers of HDEs or HDVs that are currently allowed so that they can, if they choose, pay NCPs and continue to sell their engines and vehicles while finishing their development of fully complying engines. A manufacturer of a previously certified engine or vehicle should not be forced to immediately remove an HDE or HDV from the market when an emission standard becomes more stringent. The prior emissions standard generally meets these goals because manufactures have already certified their vehicles to that standard.

In the past, EPA has rejected suggestions that the upper limit should be more stringent than the prior emission standard because it would be very difficult to identify a limit that could be met by all manufacturers. For this rule, however, all manufacturers are currently certifying all of their engines at or below the 0.50 g/hp-hr FEL cap. Thus, since NCPs were not intended to allow manufacturers to increase emissions, we are setting the upper limit for this NCP rule at 0.50 g/hp-hr NOX. This will conform to the purpose of NCPs, which is to allow manufacturers to continue selling engines they are producing, but not to allow backsliding.

(2) Cost Parameter Values

The regulations being adopted specify that the values in Table 1 (in 2011 dollars) be used in the NCP formula for the 2012 and later model year NOXstandard of 0.20 g/hp-hr for diesel heavy heavy-duty engines. The basis is summarized here. The complete derivation of these parameters is described in the Interim Technical Support Document for this rulemaking.

We also considered other methodologies for estimating the incremental compliance costs between the upper limit and the standard. We rejected these alternatives because we are not confident that we could estimate the costs with sufficient accuracy or describe our basis without revealing confidential business information. Moreover, we have no reason to believethat these alternative methodologies would have been better with respect to the statutory requirement to remove the competitive disadvantage of the complying manufacturers.

(a) General Methodology

Based on our review of the various hypothetical baseline engine designs, we selected a straightforward “baseline engine” technology package with associated costs that were determinable within a reasonably high degree of certainty. This approach best limited the sensitivity of the penalty rate versus small variations in any of the “baseline engine” technology package elements. This cost stability mitigated the hypothetical nature of the “baseline engine” technology package, which, in turn, led to a penalty rate that we believe is reasonable. As is described in the TSD, we believe estimating costs by this approach is the least speculative method to determine compliance costs.

We selected a baseline engine technology package that would employ the same basic emission controls used to meet the 2007 NOXand PM emission standards (e.g.cooled exhaust gas recirculation), optimized turbo-charging, optimized fuel injection, diesel particulate filters), plus liquid urea based Selective Catalytic Reduction (SCR) NOXemissions control technology with an appropriately sized tank for the diesel exhaust fluid (DEF). Further details are provided in this rule's TSD. While EPA selected the baseline engine (or upper limit engine) to be a fully optimized, SCR-equipped engine that complies with all other emission standards and requirements, the NCPs may be used for engines using other technologies.

This approach differs slightly from that used in previous NCP rules, where EPA based the NCPs directly on an average of actual compliance costs for all manufacturers. This was appropriate in those prior rules because each of the manufacturers had actually produced engines at the upper limit (which was usually the previous emission standard). It was relatively straightforward for them to provide us with a confidential engineering analysis of the costs they actually incurred: The real costs of additional hardware and fluids and the differences in performance characteristics. We have always sought full understanding of the manufacturers' inputs, and for previous NCP rules it was also reasonable for EPA to conclude that the manufacturers' input accurately reflected the manufacturers' actual costs because the costs were derived directly from actual in-production engine information. In the case of this NCP rule, however, compliant manufacturers have not designed and optimized in-production engines for the U.S. market at 0.50 g/hp-hr NOX(the upper limit). Thus, a compliance cost estimate based directly on actual experience for in-production engines was not available for this NCP rule.

Instead of averaging actual costs (because none were available), the NCP penalty formulas for this rule are based primarily on EPA's estimate of the cost difference between an engine emitting at the upper limit (the “baseline engine”) and one emitting at the standard (the “compliant engine”). We requested cost of compliance information from several engine manufacturers and used that information to inform our own analysis of compliance costs, as described in the Interim and Proposed Technical Support Document. The engine manufacturers we contacted approached this cost analysis in the same way we did. That is, the scenarios we and the manufacturers considered were all based upon hypothetical baseline engine designs that were intended to meet the 0.50 g/hp-hr NOXupper limit.

It is worth noting that each of the five engine manufacturers we contacted considered hypothetical baseline engines with different technology packages. Two complying manufacturers based their compliance costs on a baseline engine equipped with similar (but not identical) hardware as EPA; another on an SCR-equipped engine without exhaust gas recirculation, and a fourth on its estimation of the non-complying engines produced by a competitor. All four manufacturers meeting the 0.20 g/hp-hr NOXstandard compared the costs for their hypothetical baseline engines to the costs for their actual compliant engines. The one non-SCR manufacturer we contacted (that has not yet certified any engines with NOXemissions at 0.20 g/hp-hr) provided its projections of what it will spend to bring its current 2011 engine into compliance without the use of emission credits.

(b) Calculated Values

The most significant of the NCP parameters is the 90th percentile costs of compliance, COC90, which defines the penalty for engines emitting at the upper limit. The value of COC50only matters when EPA estimates that marginal compliance costs change as the compliance level approaches the standard. In such cases, COC50defines that point on the curve at which the slope changes. We estimated COC90and COC50by assuming the baseline engine would have been an SCR equipped engine with NOXemissions at 0.50 g/hp-hr and that it looked very similar to an engine with NOXemissions at 0.20 g/hp-hr. However, the higher NOXemissions of the baseline engine would allow the use of less expensive hardware and would require less consumption of liquid urea (also known as diesel emission fluid or “DEF”).

We estimated the marginal costs of compliance as being equal to the total incremental costs of compliance divided by 0.30 g/hp-hr (the difference between the upper limit and the standard). This assumes that the cost to reduce emissions from 0.30 g/hp-hr to 0.20 g/hp-hr is not significantly different from the cost to reduce emissions from 0.50 g/hp-hr to 0.40 g/hp-hr. This results in a penalty curve that is a straight line, which in turn makes our estimate of the average cost of compliance irrelevant to the calculation of the penalty. In other words, the COC50point lies directly between zero cost at 0.20 g/hp-hr and COC90at the Upper Limit of 0.50 g/hp-hr NOX. The penalty paid for engines at the upper limit would be equal to EPA's estimate of the highest marginal cost paid by a complying manufacturer for the same emission range.

The calculation parameters listed in Table 1 are used to calculate the penalty rate. These parameters are used in the penalty rate formulas which are defined in the existing NCP regulations (See 40 CFR 86.1113(a)(1) and (2)). Using the parameters in Table 1, and the equations in the existing NCP regulations, we have plotted penalty rates versus compliance levels in Figure 1 below. This penalty curve is for the first year of use of the NCPs (i.e.,the annual adjustment factors specified in the existing NCP regulations have been set equal to one).

ER31JA12.020

The Clean Air Act NCP provisions require that the penalty be set at such a level that it removes any competitive disadvantage a complying manufacturer by requiring non-complying manufacturers to pay NCPs. Our methodology for developing the NCP is detailed in the Interim and Proposed Technical Support Document. Our technology approach includes relatively minor hardware upgrades, calibration changes, and increased use of DEF. For the reasons described in the Interim and Proposed Technical Support Document, we believe that the NCPs being established in this rulemaking will remove any competitive disadvantage that complying manufacturers may face.

VI. Economic Impact

Because the use of NCPs is optional, manufacturers have the flexibility and will likely choose whether or not to use NCPs based on their ability to comply with emissions standards. If no manufacturer elects to use NCPs, these manufacturers and the users of their products will not incur any additional costs related to NCPs. NCPs remedy the potential problem of having a manufacturer forced out of the marketplace due to that manufacturer's inability to conform to new, strict emission standards in a timely manner. Without NCPs, a manufacturer which has difficulty certifying HDEs in conformance with emission standards or whose engines fail a Selective Enforcement Audit (SEA) has only two alternatives: fix the nonconforming engines, perhaps at a prohibitive cost, or prevent their introduction into commerce. The availability of NCPs provides manufacturers with a third alternative: continue production and introduce into commerce upon payment of a penalty an engine that exceeds the standard until an emission conformance technique is developed. Therefore, NCPs represent a regulatory mechanism that allows affected manufacturers to have increased flexibility. A decision to use NCPs may be a manufacturer's only way to continue to introduce its products into commerce.

VII. Environmental Impact

When evaluating the environmental impact of this rule, one must keep in mind that, under the Act, NCPs are a consequence of enacting new, more stringent emissions requirements for heavy duty engines. Emission standards are set at a level that most, but not necessarily all, manufacturers can achieve by the model year in which the standard becomes effective. FollowingInternational Harvesterv.Ruckelshaus,478 F. 2d 615 (DC Cir. 1973), Congress realized the dilemma that technology-forcing standards could potentially cause, and allowed manufacturers of heavy-duty engines to certify nonconforming vehicles/engines upon the payment of an NCP, under certain terms and conditions. This mechanism was intended to allow manufacturer(s) who cannot meet technology-forcing standards immediately to continue to manufacture nonconforming engines while they tackle the technological problems associated with meeting new emission standard(s). Thus, as part of the statutory structure to force technological improvements without driving manufacturers or individual engine models out of the market, NCPs provide a flexibility that fosters long-term emissions improvement through the setting of lower emission standards at an earlier date than could otherwise be feasible. Because NCPs are designed to increase with time, manufacturers using NCPs are likely to reduce emission levels to meet the standard as quickly as possible, which minimizes the environmental impact.

As is always the case with NCPs, the potential exists for there to be more extensive use of NCPs beyond what may be expected to be used by the manufacturer that we believe will need them. For example, depending upon the penalty rate and other factors, some otherwise fully compliant manufacturers could elect to pay the NCP in order to reconfigure their 0.20 g/hp-hr NOXcompliant engines to emit up to 0.50 g/hp-hr so that they can re-optimize engine hardware and vehicle operating costs. This potential action is not without R&D and other financial costs to the manufacturer and thus is not a decision which would betaken lightly, given the short-term nature of the NCPs allowed for in this interim final rule. Furthermore, we believe that any such impacts would be short-term and self-limiting in nature because the NCP annual adjustment factor, established via prior NCP rules, increases the levels of the penalties over time and based on the extent of the use of NCPs by all manufacturers. In other words the NCP program is structured such that the incentives to produce engines that meet the standard increase year-by-year and increase upon NCP use. The practical impact of this adjustment factor is that the NCPs will rapidly become an undesirable option for all manufacturers that may elect to use them. However, while we expect their use to be limited, we have no way of predicting at this time how many manufacturers will make use of the NCPs, or how many engine families would be subject to the NCP program. Because of these uncertainties we are unable to accurately quantify the potential impact the NCPs might have on emission inventories, although, as stated above, any impacts are expected to be short-term and self-limiting in nature.

VIII. Public Participation

We are opening a formal comment period by publishing this document. We will accept comments for the period indicated underDATESabove. If you have an interest in the program described in this document, we encourage you to comment on any aspect of this rulemaking.

Your comments will be most useful if you include appropriate and detailed supporting rationale, data, and analysis. If you disagree with parts of the interim program, we encourage you to suggest and analyze alternate approaches to meeting the goals described in this Interim Final Rule. You should send all comments, except those containing proprietary information, to our Air Docket (seeADDRESSES) before the end of the comment period.

If you submit proprietary information for our consideration, you should clearly separate it from other comments by labeling it “Confidential Business Information.” You should also send it directly to the contact person listed underFOR FURTHER INFORMATION CONTACTinstead of the public docket. This will help ensure that no one inadvertently places proprietary information in the docket. We will disclose information covered by a claim of confidentiality only through the application of procedures described in 40 CFR part 2. If you do not identify information as confidential when we receive it, we may make it available to the public without notifying you.

IX. Statutory and Executive Order ReviewsA. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review

This action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

B. Paperwork Reduction Act

This action does not impose any new information collection burden. It only updates the penalty amounts to correspond to the current emission standards. However, the Office of Management and Budget (OMB) has previously approved the information collection requirements contained in the existing regulations 40 CFR part 86, subpart L under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501et seq.and has assigned OMB control number 2060-0132. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act(1) Overview

The Regulatory Flexibility Act generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.

For purposes of assessing the impacts of these rules on small entities, small entity is defined as: (1) A small business as defined by SBA regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

(2) Summary of Potentially Affected Small Entities

After considering the economic impacts of this rule on small entities, I certify that this action will not have a significant impact on a substantial number of small entities.

When these emission standards were established, the final rulemaking (66 FR 5001, January 18, 2001) noted that we were not aware of “any manufacturers of heavy-duty engines that meet SBA's definition of a small business.” Based on an updated assessment, EPA has identified a total of about 14 manufacturers that produce diesel cycle heavy-duty motor vehicle engines. Of these, none of these are small businesses that are producing engines with NOXemissions above 0.20 g/hp-hr. Based on this, we are certifying that this rule will not have a significant economic impact on a substantial number of small entities.

(3) Conclusions

I therefore certify that this Interim Final Rule will not have a significant economic impact on a substantial number of small entities.

D. Unfunded Mandates Reform Act

This rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. The agency has determined that this action does not contain a Federal mandate that may result in expenditures of $100 million or more for the private sector in any one year. Because the use of NCPs is optional, manufacturers have the flexibility and will likely choose whether or not to use NCPs based on their ability to comply with emissions standards. The availability of NCPs provides manufacturers with a third alternative: To continue production and introduce into commerce upon payment of a penalty an engine that exceeds the standard until an emission conformance technique is developed. Therefore, NCPs represent a regulatory mechanism that allows affected manufacturers to have increased flexibility. Thus, this action is not subject to the requirements of sections 202 or 205 of the UMRA. This action is also not subject to the requirements of section 203 of the UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.

E. Executive Order 13132 (Federalism)

Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined inthe Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.”

This action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. These rules will apply to manufacturers of on-highway engines and not to State or local governments. Thus, Executive Order 13132 does not apply to this action.

F. Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments)

This IFR does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). This rule will be implemented at the Federal level and impose compliance costs only on engine manufacturers who elect to use the NCP regulatory flexibility to comply with emissions standards. Tribal governments would be affected only to the extent they purchase and use engines and vehicles to which an NCP has been applied. Thus, Executive Order 13175 does not apply to this rule.

G. Executive Order 13045: “Protection of Children From Environmental Health Risks and Safety Risks”

Executive Order 13045: “Protection of Children from Environmental Health Risks and Safety Risks” (62FR19885, April 23, 1997) applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the agency.

EPA interprets Executive Order 13045 as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Order has the potential to influence the regulation. This rule is not subject to Executive Order 13045 because it does not establish an environmental standard intended to mitigate health or safety risks.

H. Executive Order 13211 (Energy Effects)

This action is not subject to Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, 12(d) (15 U.S.C. 272 note) directs the agencies to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g.,materials, specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the EPA decides not to use available and applicable voluntary consensus standards.

This rule does not involve technical standards. Therefore, EPA is not considering the use of any voluntary consensus standards.

Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA has determined that this action will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations. The overall environmental impacts of this action are expected to be small and of limited duration. Moreover, there is no reason to believe that trucks using NCP engines will be more likely to operate near any minority or low-income populations than other trucks.

K. Congressional Review Act

The Congressional Review Act, 5 U.S.C. 801et seq.,as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. Section 808 allows the issuing agency to make a rule effective sooner than otherwise provided by the CRA if the agency makes a good cause finding that notice and public procedure is impracticable, unnecessary or contrary to the public interest. This determination must be supported by a brief statement. 5 U.S.C. 808(2). As stated previously in Section II above, EPA has made such a good cause finding, including the reasons therefore, and established an effective date of January 31, 2012. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in theFederal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

X. Statutory Provisions and Legal Authority

Statutory authority for the vehicle controls in these rules is found in CAA section 206(g), of the CAA, 42 U.S.C. 7525(g).

EPA shall set a separate upper limit for each phase of NCPs and for each service class.

(a) The provisions of this section specify a default approach for determining the upper limit values.

(1) The default upper limit applicable to a pollutant emission standard for a subclass of heavy-duty engines or heavy-duty vehicles for which an NCP is established in accordance with § 86.1103-87, shall be the previous pollutant emission standard for that subclass.

(2) If a manufacturer participates in any of the emissions averaging, trading, or banking programs, and carries over certification of an engine family from the prior model year, the upper limit for that engine family shall be the family emission limit of the prior model year, unless the family emission limit is less than the upper limit determined in paragraph (a) of this section.

(b) If no previous standard existed for the pollutant under paragraph (a) of this section, the upper limit will be developed by EPA during rulemaking.

(c) EPA may set the upper limit during rulemaking at a level below the default level specified in paragraph (a) of this section if we determine that a lower level is achievable by all engines.

3. Section 86.1105-87 is amended by revising paragraph (e) and adding paragraph (j) to read as follows:§ 86.1105-87Emission standards for which nonconformance penalties are available.

(e) The values of COC50, COC90, and MC50 in paragraphs (a) and (b) of this section are expressed in December 1984 dollars. The values of COC50, COC90, and MC50 in paragraphs (c) and (d) of this section are expressed in December 1989 dollars. The values of COC50, COC90, and MC50 in paragraph (f) of this section are expressed in December 1991 dollars. The values of COC50, COC90, and MC50 in paragraphs (g) and (h) of this section are expressed in December 1994 dollars. The values of COC50, COC90, and MC50 in paragraph (i) of this section are expressed in December 2001 dollars. The values of COC50, COC90, and MC50 in paragraph (j) of this section are expressed in December 2011 dollars. These values shall be adjusted for inflation to dollars as of January of the calendar year preceding the model year in which the NCP is first available by using the change in the overall Consumer Price Index, and rounded to the nearest whole dollar in accordance with ASTM E29-67 (reapproved 1980), Standard Recommended Practice for Indicating Which Places of Figures are to be Considered Significant in Specified Limiting Values. This method was approved by the Director of theFederal Registerin accordance with 5 U.S.C. 552(a) and 1 CFR part 51. This document is available from ASTM International, 100 Barr Harbor Drive, P.O. Box C700, West Conshohocken, PA 19428-2959, and is also available for inspection as part of Docket A-91-06, located at the U.S. EPA, Air and Radiation Docket and Information Center, 1301 Constitution Ave., NW., Room 3334, EPA West Building, Washington, DC 20004, (202) 202-1744or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call (202) 741-6030, or go to:http://www.archives.gov/federal-register/cfr/ibr-locations.html.These materials are incorporated as they exist on the date of the approval and a notice of any change in these materials will be published in theFederal Register.

(j) Effective in the 2012 and 2013 model years, NCPs will be available for the following emission standard:

This rule proposes to amend the National School Lunch Program (NSLP) regulations to incorporate provisions of the Healthy, Hunger-Free Kids Act of 2010 designed to encourage States to improve direct certification efforts with the Supplemental Nutrition Assistance Program (SNAP). The provisions would require State agencies to meet certain direct certification performance benchmarks and to develop and implement continuous improvement plans if they fail to do so. This rule also proposes to amend NSLP and SNAP regulations to provide for the collection of data elements needed to compute each State's direct certification performance rate to compare with the new benchmarks.

DATES:

Comments on rule provisions must be received on or before April 2, 2012 to be assured of consideration.

Comments on the information collection requirements associated with this rule must be received by April 2, 2012.

ADDRESSES:

The Food and Nutrition Service, USDA, invites interested persons to submit comments on this proposed rule. Comments may be submitted by one of the following methods:

All comments submitted in response to this proposed rule will be included in the record and will be made available to the public. Please be advised that the substance of the comments and the identity of the individuals or entities submitting the comments will be subject to public disclosure. The Food and Nutrition Service will make the comments publicly available on the Internet viahttp://www.regulations.gov.FOR FURTHER INFORMATION CONTACT:

Address any questions to Vivian Lees or Patricia B. von Reyn, State Systems Support Branch, at (703) 305-2590.

SUPPLEMENTARY INFORMATION:BackgroundA. Legislative History Leading Up to This Rulemaking

Section 104 of the Child Nutrition and WIC Reauthorization Act of 2004 (Pub. L. 108-265) amended section 9(b) of the Richard B. Russell National School Lunch Act (NSLA) (42 U.S.C. 1758(b)) to require all local educational agencies (LEAs) that participate in the NSLP and/or School Breakfast Program to establish, by school year (SY) 2008-2009, a system to directly certify as eligible for free school meals children who are members of households receiving assistance under SNAP.

Section 4301 of the Food, Conservation, and Energy Act of 2008 (Pub. L. 110-246) (42 U.S.C. 1758a) requires the Secretary of Agriculture, beginning in 2008, to assess the effectiveness of State and local efforts to directly certify such children for free school meals and to provide annual reports to Congress.

Section 101(b) of Public Law 111-296, the Healthy, Hunger-Free Kids Act of 2010 (HHFKA), amended section 9(b)(4) of the NSLA (42 U.S.C. 1758(b)(4)) to establish and define required percentage benchmarks for directly certifying children who are members of households receiving assistance under SNAP. Section 101(b) further amended the NSLA to require that, beginning with SY 2011-2012, each State that does not meet the benchmark for a particular school year must develop, submit, and implement a continuous improvement plan (CIP) aimed at fully meeting the benchmarks and improving direct certification for the following school year. It also requires that the Secretary provide technical assistance to States agencies in developing and implementing CIPs.

These provisions of Section 101(b) of the HHFKA, which were effective October 1, 2010, were implemented through USDA Food and Nutrition Service (FNS) Memorandum SP 32-2011—Child Reauthorization 2010: Direct Certification Benchmarks and Continuous Improvement Plans,dated April 28, 2011, available athttp://www.fns.usda.gov/cnd/governance/Policy-Memos/2011/SP32-2011.pdf.This rule proposes to incorporate these provisions into NSLP regulations.

Section 9(b)(4) of the NSLA, as amended by the HHFKA, sets specific State performance benchmarks for directly certifying for free school meals those children who are members of households receiving assistance under SNAP. States must directly certify for free school meals the following percentages of school-aged children from SNAP households:

• 80% for SY 2011-2012;

• 90% for SY 2012-2013; and

• 95% for SY 2013-2014 and for each school year thereafter.

Additionally, for each school year beginning with SY 2011-2012, the NSLA requires that FNS identify any State that directly certifies less than the required percentage of the total number of school-aged children in the State who are members of households receiving assistance under SNAP. This rule proposes that FNS would identify these States by calculating direct certification rates for each State and comparing them with the required benchmark. (See the next section, “Data elements needed to compute States' direct certification rates for comparison to the benchmarks.”)

This proposed rule provides that after FNS notifies a State agency that its State did not meet the direct certification performance benchmark, the State agency would have 60 days to submit itsCIP to FNS for approval. The NSLA requires that CIPs include, at a minimum:

1. Specific measures that the State will use to identify more children who are eligible for direct certification, including improvements or modifications to technology, information systems, or databases;

2. A timeline for the State to implement these measures; and

3. Goals for the State to improve direct certification results for the following school year.

This proposal would add the word “multiyear” to the second component above, so that the CIP would include a multiyear timeline for the State to implement these measures. This is in acknowledgement of the possibility that by the time a State agency's CIP is submitted to FNS and approved, the new school year may already be underway.

In addition, we are proposing to add a fourth component to the minimum requirements for a CIP:

This fourth component to the minimum requirements for a CIP would help ensure that States are in compliance with other direct certification requirements, such as the new provisions required by the Interim Rule,Direct Certification and Certification of Homeless, Migrant and Runaway Children for Free School Meals(76 FR 22785, April 25, 2011) athttp://www.fns.usda.gov/cnd/governance/regulations/2011-04-25.pdf.State agencies would need, for example, to include information regarding their State's success at conducting direct certification efforts at least three times per year as well as their progress at phasing out the “Letter Method” as a form of direct certification with SNAP. For more guidance on the phase-out of the “Letter Method,” refer to FNS Memorandum SP 13-2011,Child Nutrition Reauthorization 2010: Letter Method for Direct Certification,dated January 14, 2011, and FNS Memorandum SP 32-2011,Child Nutrition Reauthorization 2010: Direct Certification Benchmarks and Continuous Improvement Plans,dated April 28, 2011, both available athttp://www.fns.usda.gov/cnd/governance/policy.htm.

This rule proposes to amend 7 CFR Part 245 by redesignating §§ 245.12 and 245.13 as §§ 245.13 and 245.14, respectively, and adding a new § 245.12 to set the required direct certification performance benchmarks, to require CIPs of any State that fails to meet a given benchmark, and to define the minimum required components of a CIP.

Each year since 2008, FNS has computed direct certification rates for each State to include in the annual report to Congress required by section 4301 of the Food, Conservation, and Energy Act of 2008. (See theDirect Certification in the National School Lunch Program: State Implementation Progress(Report to Congress) for 2008, 2009, 2010, and 2011 athttp://www.fns.usda.gov/ora/menu/Published/CNP/cnp.htm.) To formulate these direct certification rates, we have used a variety of data sources and a complex system of estimations and adjustments to approximate each of three component statistics required by section 4301:

1. The number of school-aged children who were directly certified as eligible for free school meals based on SNAP as of October;

2. The number of school-aged children who were members of a household receiving SNAP assistance at any time in July, August, or September; and

3. The number of school-aged children attending special provision schools (in a non-base year) who were members of a household receiving SNAP assistance at any time in July, August, or September.

We are proposing with this rulemaking to collect single data elements which would replace, wherever possible, the complex estimates we have had to make for each of these component statistics. Using these new data elements would allow for a timelier and a more straightforward, accurate, and transparent methodology for calculating States' direct certification rates. In addition, State agencies would have early access to these data elements and would be able to track their own performance as the data becomes available, using the same methodology that FNS uses—something currently not possible. This also would allow State agencies to better evaluate whether certain refinements to their direct certification systems or improvements outlined in their CIPs are effectual. It could even preclude the need for a CIP if data errors were to be identified and then corrected by SAs as LEAs report in.

The new data elements needed to better meet the requirements of this mandate and to better serve the needs of State agencies as they endeavor to meet and maintain these new direct certification benchmarks are proposed as follows:

Data Element #1—SNAP Children Directly Certified for Free School Meals

Data Element #1 is the count of the number of children who are members of households receiving assistance under SNAP and who were directly certified for free school meals as of the last operating day in October. This is to be a count of SNAP direct certifications only. Direct certification with other programs, such as with the Temporary Assistance to Needy Families (TANF) program, the Food Distribution Program on Indian Reservations (FDPIR), or with any of the other categorically eligible programs, would not be included. Additionally, only direct certifications are to be included, not certifications by application using a SNAP case number or through the “Letter Method.” The form FNS-742,Verification Summary Report,(OMB #0584-0026) has for years collected the broader count (one that includes TANF, FDPIR, “Letter Method,” etc.), but this data element, which is needed to selectively identify SNAP direct certifications, would be separately collected on the FNS-742 that is currently undergoing revision.

Data Element #2—Universe of School-Aged Children in SNAP Households

Data Element #2 is the unduplicated count of children ages 5 to 17 years old who are members of households receiving assistance under SNAP at any time during the months of July, August, or September. The best source for this count is the SNAP State agency, which maintains an existing collection of program participation data that is used for the direct certification matching with SNAP. This dataset includes birthdates, making it possible to query for the target age-range of 5 to 17 year olds. This count from the SNAP State agency would be far more accurate than what could be estimated from other sources. For this reason, the proposed rule would require the SNAP State agency to provide Data Element #2 both to FNS and to the State agency administering the NSLP, by December 1st each year, on the proposed new form, the FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,which is being submitted to OMB for approval. This Data Element #2 would represent the universe of school-aged children who could be directly certified with SNAP to receive free school meals.

We recognize that even though this data element is a strong one, it is not exact. The count coming from SNAP forthis data element may include children who are not actually attending school in the State come September or who are attending a school that does not participate in the NSLP. As a result, the direct certification rate may be negatively impacted. Conversely, there may be students attending school in the State who are not represented in the count coming from SNAP, particularly when a State has, for instance, a mandatory pre-K program or a large special education program with children up to age 22. We have chosen to ask SNAP for the number of children 5 to 17 years old because that age range can be used across the board for all States, it is the usual age range for children in schools across the United States, and it is the age range that we have used in the past for the Reports to Congress to represent “school-aged.” When States run their matches on a wider age-range than that which represents the ages of students typically participating in the NSLP and are able to match these younger than 5-year-olds or older than 17-year-olds, the direct certification rate may be inflated. As structured, however, this data element would be more accurate than what FNS has been able to use in the past. See the “Special Circumstances” section below that invites public comments.

Data Element #3—SNAP Children in Special Provision Schools Operating in a Non-Base Year

Data Element #3 is a count of the number of children from households receiving assistance under SNAP that attend schools operating in a non-base year under the special assistance provisions of Section 11(a)(1) of the NSLA (42 U.S.C. 1759a(a)(1)) and 7 CFR 245.9. These are typically referred to as Provision 2 and Provision 3 schools, but will also include such schools as the Community Eligibility option schools that were added to Section 9(b) of the NSLA, 42 U.S.C. 1758(b), by Section 103 of the HHFKA and which will be addressed in future rulemaking. These special provision schools do not collect applications or directly certify children for free school meals every year; instead, they typically serve all children free meals, but are reimbursed based on the number of children who were determined to be eligible for free or reduced-price meals through application and/or direct certification in some prior year, called the base year.

When a special provision school is operating in a base year, application processing and/or direct certification would occur as it does in other schools, and the counts of children directly certified with SNAP would be reported by the LEA through the normal verification report (the FNS-742) described for Data Element #1 above.

When a special provision school is operating in a non-base year, however, the direct certification counts from the school, as reported by the LEA for the FNS-742, would be zero—no child from that school, whether from a household receiving SNAP benefits or not, would be directly certified that year because children already receive free meals through the special provision. Since the direct certification rate for a State is determined by the number of school-aged SNAP children directly certified as compared to the universe of school-aged SNAP children, States would show a lower direct certification rate whenever their special provision schools were in a non-base year unless some adjustment were made. For the Report to Congress, we have adjusted for this by estimating the number of SNAP children in special provision schools and offsetting the universe of school-aged SNAP children by this estimate. One of the difficulties with this methodology is that if the number of SNAP-children has increased significantly in a particular State since a special provision school's most recent base year, then the estimate for the offset might be too low and the State's direct certification rate may drop.

To get a better measure for this adjustment, we propose to require that States run a match between SNAP records and student enrollment records from special provision schools each non-base year and count—for these schools only—the number of children for whom a match is found and who theoretically could have been directly certified from that match had it occurred in a base year. Note that this is not a requirement to directly certify during the non-base year—LEAs still would not directly certify children since the children already get free meals through the special provision. A match in and of itself does not constitute a direct certification, and this matching process—which more often than not could be done at the State level—would be employed for the express purpose of getting a more-accurate count with which to make adjustments to the direct certification rate for the State. Under the proposed rule, all such SNAP matches in special provision schools operating in a non-base year would be included in the count for this data element. The resulting adjustment would more closely track the fluctuations in the number of SNAP children actually in these schools, would yield a more-accurate direct certification rate, and would give a better preview of the competency of the direct certification system before its use when the school is again in a base year.

We propose to require that these matching efforts for special provision schools operating in a non-base year occur in or close to October, but no later than the last operating day in October. This Data Element #3 would be reported by the State agency administering the NSLP on the proposed new form, the FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,by December 1st each school year.

Special Circumstances

We would be interested in learning about any special circumstances that would affect a State's direct certification rate in a quantifiable way not captured by the formula below or the three data elements above. We would also be interested in any suggested methodology to quantify the effect, supportable by published Federal or State data sources.

Formula—for Calculating Direct Certification Rates With SNAP

We propose to calculate States' direct certification rates with SNAP (the percent of children in households receiving assistance under SNAP that are directly certified for free school meals) using Data Elements #1-#3 as described above:

EP31JA12.006

These new data elements for calculating direct certification effectiveness would be reported both by the SNAP State agency and by the State agency that administers the NSLP, as described in the next two sections. It is critical that these data elements be available starting with SY 2012-2013 so that FNS and State agencies have the tools to monitor performance under this mandate.

The proposed new § 245.12(c) would require the reporting of the new data elements for computing direct certification rates to assess State progress in meeting the mandated direct certification performance benchmarks.

This rule also proposes to amend SNAP's regulations at 7 CFR 272.8 to add the requirement for the SNAP State agency to provide Data Element #2 to FNS and to the State agency administering the NSLP.

D. Collection of Data Element #1, and the Effect of This Rule on Form FNS-742, Verification Summary Report

As described above, this rule proposes to collect Data Element #1 on the FNS-742,Verification Summary Report,which is under revision at this time. The proposed rule would change the date this report is due so that Data Element #1 can be available as soon as possible for FNS and State agencies to use in calculating direct certification rates with SNAP.

Currently, § 245.6a(b) requires LEAs to complete verification efforts by November 15th each year (unless approved for an extension until December 15th by the State agency for reasons outlined in § 245.6a(b)(2)). In addition, State agencies currently must collect this annual verification data from each LEA no later than March 1st, and must submit it to FNS no later than April 15th of each year. Earlier availability of this data would enable FNS and State agencies earlier calculation of direct certification rates. The current FNS-742, however, requires State agencies to report the aggregate number of students who were terminated as a result of verification but who were reinstated for free or reduced price meal benefits as of February 15th each year based on regulatory provisions at § 245.11(i). Those provisions reference a contingency on “new funding” that has not been appropriated since the rule's codification. As such, we propose to remove the requirement to report those students who were reinstated and to adjust the deadlines for the FNS-742, as follows:

1. LEAs would continue to be required to complete verification efforts by November 15th (or, if approved for an extension by the State agency for reasons outlined in § 245.6a(b)(2), by December 15th).

2. State agencies would be required to collect the annual verification data from each LEA by February 1st (instead of March 1st).

3. State agencies would be required to submit the FNS-742 to FNS by March 15th (instead of April 15th).

The earlier submission of the FNS-742, as proposed in this rule, would allow State agencies and FNS timelier access to data elements important for the direct certification rate calculation and for the annual report to Congress. Additionally, it would allow State agencies to take ameliorative actions early on, before notification of a need for a CIP, providing more time for developing CIPs.

This proposed rule would remove the February 15th data element requirement by amending § 245.11(i) to remove the language, “Contingent upon new funding to support this purpose, FNS will also require each State agency to report the aggregate number of students who were terminated as a result of verification but who were reinstated as of February 15th.” It would also amend § 245.6a(h) and § 245.11(i) to change the dates for State agency collection of verification data from LEAs and for State agency reporting to FNS on the FNS-742, effective beginning with SY 2012-2013.

E. Collection of Other New Data Elements.

For collecting Data Elements #2 and #3, FNS is proposing a new data reporting instrument which is being cleared along with this proposed rule. This instrument, the proposed FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,is an interagency form that would be used by both the SNAP State agencies and the State agencies administering the NSLP.

This new data collection instrument, whose information collection burden is being cleared with this proposed rule, is described in the Paperwork Reduction Act section of this preamble. It is provided as Appendix A to this proposed rule for informational purposes only.

F. States Affected by This Rule

All States, except those that have statewide universal free lunch, are affected by this rule. At this time, the States affected by this rule are the 50 States, District of Columbia, and Guam.

Procedural MattersExecutive Order 12866 and Executive Order 13563

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.

This rule has been designated non-significant under section 3(f) of Executive Order 12866.

Regulatory Flexibility Act

This rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act of 1980, (5 U.S.C. 601-612). Pursuant to that review, it has been certified that this rule would not have a significant impact on a substantial number of small entities.

Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local and tribal governments and the private sector. Under section 202 of the UMRA, the Department generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures by State, local or tribal governments, in the aggregate, or the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, section 205 of the UMRA generally requires the Department to identify and consider a reasonable number of regulatory alternatives and adopt the most cost effective or least burdensome alternative that achieves the objectives of the rule.

This proposed rule does not contain Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local and tribal governments or the private sector of $100 million or more in any one year. Thus, the rule is not subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

This proposed rule affects the NSLP and SNAP.

The NSLP is listed in the Catalog of Federal Domestic Assistance Programsunder No. 10.555. For the reasons set forth in the final rule in 7 CFR part 3015, subpart V, and related Notice (48 FR 29115, June 24, 1983), this program is included in the scope of Executive Order 12372 which requires intergovernmental consultation with State and local officials. Since the NSLP is State-administered, Federally-funded program, FNS headquarters staff and FNS Regional Office staff have formal and informal discussions with State and local officials on an ongoing basis regarding program requirements and operation. This structure allows FNS to receive regular input which contributes to the development of meaningful and feasible Program requirements.

SNAP is listed in the Catalog of Federal Domestic Assistance under 10.551. For the reasons set forth in the final rule at 7 CFR Part 3015, Subpart V and related Notice (48 FR 29115, June 24, 1983), SNAP is excluded from the scope of Executive Order 12372 which requires intergovernmental consultation with State and local officials.

Federalism Summary Impact Statement

Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have federalism implications, agencies are directed to provide a statement for inclusion in the preamble to the regulations describing the agency's considerations in terms of the three categories called for under Section (6)(b)(2)(B) of Executive Order 13121. FNS has considered the impact of this rule on State and local governments and has determined that this rule does not have federalism implications. Therefore, under Section 6(b) of the Executive Order, a federalism summary is not required.

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule, when published as a final rule, is intended to have preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions or which would otherwise impede its full and timely implementation. This rule is not intended to have retroactive effect unless so specified in the Effective Dates section of the final rule. Prior to any judicial challenge to the provisions of the final rule, all applicable administrative procedures must be exhausted.

Civil Rights Impact Analysis

FNS has reviewed this proposed rule in accordance with the Department Regulation 4300-4, Civil Rights Impact Analysis, to identify any major civil rights impacts the rule might have on children on the basis of race, color, national origin, sex, age or disability.

This rule requires State agencies to develop and implement CIPs if they do not meet certain percentage performance benchmarks for directly certifying for free school meals children in households receiving SNAP benefits. LEAs have for years been required to directly certify for free school meals those children in households receiving assistance under SNAP, and FNS has been required to assess State and local efforts to directly certify these children. This rule codifies the benchmarks and CIP requirements set by the HHFKA. After a careful review of the rule's intent and provisions, FNS has determined that this rule is technical in nature and affects State agencies only. This rule will not affect children in the NSLP, except to continue to encourage States to increase efforts to have more eligible children directly certified for free meals.

Executive Order 13175—Consultation and Coordination With Indian Tribal Governments

USDA is unaware of any current Tribal laws that could be in conflict with the requirements of this proposed rule. However, we have made special efforts to reach out to Tribal communities. In the spring of 2011, FNS offered opportunities for consultation with Tribal officials or their designees to discuss the impact of the Healthy, Hunger-Free Kids Act of 2010 on tribes or Indian Tribal governments. The consultation sessions were coordinated by FNS and held on the following dates and locations:

There were no comments about this regulation during any of the aforementioned Tribal Consultation sessions.

Reports from these consultations are part of the USDA annual reporting on Tribal consultation and collaboration. FNS will respond in a timely and meaningful manner to Tribal government requests for consultation concerning this rule. Currently, FNS provides regularly scheduled quarterly consultation sessions through the end of FY2012 as a venue for collaborative conversations with Tribal officials or their designees.

Paperwork Reduction Act

The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; see 5 CFR 1320), requires that the Office of Management and Budget (OMB) approve all collections of information by a Federal agency from the public before they can be implemented. Respondents are not required to respond to any collection of information unless it displays a current, valid OMB control number. This is a new collection.

One of the new provisions in this rule—the requirement for the development and submission of continuous improvement plans by any State that fails to meet certain mandated direct certification performance benchmarks—annually increases State agency reporting burden by 54 hours and the recordkeeping burden by 9 hours, for a total of 63 additional burden hours. FNS intends to merge these 63 hours into the Determining Eligibility for Free and Reduced Price Meals, OMB Control #0584-0026, expiration date March 31, 2013. The current collection burden inventory for the Determining Eligibility for Free and Reduced Price Meals (7 CFR 245) is 960,367.

Another provision, requiring the collection of data elements on a new, interagency form (FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,being cleared with this proposed rule), involves changes in both NSLP and SNAP regulations and would increase burden hours on State agencies by an additional 53 hours annually. These 53 burden hours would remain with the newly established OMB Control Number until such time as the FNS-834 is incorporated into the Food Programs Reporting System (FPRS) and the system is approved by OMB.

These changes are contingent upon OMB approval under the Paperwork Reduction Act of 1995. When the information collection requirements have been approved, FNS will publish a separate action in theFederal Registerannouncing OMB's approval.

Comments on the information collection in this proposed rule must be received by April 2, 2012. Send comments to the Office of Information and Regulatory Affairs, OMB, Attention: Desk Officer for FNS, Washington, DC20503. Please also send a copy of your comments to Lynn Rodgers-Kuperman, Chief, Program Analysis and Monitoring Branch, Child Nutrition Division, 3101 Park Center Drive, Alexandria, VA 22302. For further information, or for copies of the information collection requirements, please contact Lynn Rodgers-Kuperman at the address indicated above. Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the Agency's functions, including whether the information will have practical utility; (2) the accuracy of the Agency's estimate of the proposed information collection burden, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

All responses to this request for comments will be summarized and included in the request for OMB approval. All comments will also become a matter of public record.

Abstract:(A) Continuous Improvement Plans—The new requirements of Section 101(b) of the HHFKA necessitate the submission of a continuous improvement plan (CIP) by any State that fails to meet the new percentage performance benchmarks (80% for SY 2011-12; 85% for SY 2012-13; and 95% for SY 2013-14 and for each school year thereafter) for directly certifying for free school meals children who are members of households receiving assistance under SNAP. CIPs are required to include: Specific measures that the State will use to identify more children who are eligible for direct certification, including improvements or modifications to technology, information systems, or databases; a multiyear timeline for the State to implement these measures; goals for the State to improve direct certification results for the following school year; and information about the State's progress toward implementing other direct certification requirements.

(B) Collecting New Data Elements—In addition, FNS must calculate the direct certification rates for States and compare them to the benchmarks to determine which States will need to submit CIPs. To calculate these direct certification rates, FNS proposes to annually collect specific direct certification data elements from SNAP State agencies and NSLP State agencies on a new interagency form, the proposed FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Reportbeing cleared with this proposed rule.

(C) State agencies must report data to show progress toward improving direct certification with SNAP. Such improvement will ultimately lead to fewer households having to complete an application form to receive free school meals. The average burden per response and the annual burden hours are explained below and summarized in the charts which follow.

The Food and Nutrition Service is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

Appendix A to This Proposed Rule

Appendix A attached to this proposed rule is a sample completed form FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,currently pending OMB approval and published for informational purposes only.

Accordingly, 7 CFR Parts 245 and 272 are proposed to be amended as follows:

PART 245—DETERMIMING ELIGIBILITY FOR FREE AND REDUCED PRICE MEALS AND FREE MILK IN SCHOOLS

1. The authority citation for 7 CFR Part 245 continues to read as follows:

Authority:

42 U.S.C. 1752, 1758, 1759a, 1772, 1773, and 1779.

2. Section 245.6a is amended in paragraph (h) by removing the word “March” and adding in its place the word “February”.

3. Paragraph 245.11(i) is revised to read as follows:

§ 245.11Action by State agencies and FNSROs.

(i) No later than February 1, 2013, and by February 1st each year thereafter, each State agency must collect annual verification data from each local educational agency as described in § 245.6a(h) and in accordance with guidelines provided by FNS. Each State agency must analyze these data, determine if there are potential problems, and formulate corrective actions and technical assistance activities that will support the objective of certifying only those children eligible for free or reduced price meals. No later than March 15, 2013, and by March 15th each year thereafter, each State agency must report to FNS, in a consolidated electronic file by local educational agency, the verification information that has been reported to it as required under § 245.6a(h), as well as any ameliorative actions the State agency has taken or intends to take in local educational agencies with high levels of applications changed due to verification. State agencies are encouraged to collect and report any or all verification data elements before the required dates.

(a)Direct certification requirements.State agencies are required to meet the direct certification performance benchmarks set forth in paragraph (b) of this section for directly certifying children who are members of households receiving assistance under SNAP. A State agency that fails to meet the benchmark must develop and submit to FNS a continuous improvement plan (CIP) to fully meet the requirements of this paragraph and to improve direct certification for the following school year in accordance with the provisions in paragraphs (e), (f), and (g) of this section.

(b)Direct certification performance benchmarks.State agencies must meet performance benchmarks for directly certifying for free school meals children who are members of households receiving assistance under SNAP. The performance benchmarks are as follows:

(1) 80% for the school year beginning July 1, 2011;

(2) 90% for the school year beginning July 1, 2012; and

(3) 95% for the school year beginning July 1, 2013, and for each school year thereafter.

(1)Data Element #1—The number of children who are members of households receiving assistance under SNAP that are directly certified for free school meals as of the last operating day in October, collected and reported in the same manner and timeframes as specified in § 245.11(i).

(2)Data Element #2—The unduplicated count of children ages 5 to 17 years old who are members of households receiving assistance under SNAP at any time during the months of July, August, or September. This data element must be provided by the SNAP State agency, per 7 CFR 272.8(a)(5), and reported to FNS and to the State agency administering the NSLP in the State by December 1st each year, in accordance with guidelines provided by FNS.

(3)Data Element #3—The count of the number of children who are members of households receiving assistance under SNAP who attend a school operating under the provisions of 7 CFR 245.9 in a year other than the base year. The proxy for this data element must be established each school year through the State's data matching efforts between SNAP records and student enrollment records for these special provision schools operating in a non-base year. Such matching efforts must occur in or close to October each year, but no later than the last operating day in October. State agencies must report this data element to FNS by December 1st each year, in accordance with guidelines provided by FNS.

(d)State notification.For each school year, FNS will notify State agencies that fail to meet the direct certification performance benchmark.

(e)Continuous improvement plan required.A State agency having a direct certification rate with SNAP that is less than the direct certification performance benchmarks set forth in paragraph (b) of this section must submit to FNS for approval, within 60 days of notification, a CIP in accordance with paragraph (f) of this section.

(f)Continuous improvement plan required components.CIPs must include, at a minimum:

(1) The specific measures that the State will use to identify more children who are eligible for direct certification,including improvements or modifications to technology, information systems, or databases;

(2) A multiyear timeline for the State to implement these measures;

(3) Goals for the State to improve direct certification results for the following school year; and

(g)Continuous improvement plan implementation.A State must implement its CIP according to the timeframes in the approved plan.

PART 272—REQUIREMENTS FOR PARTICIPATING STATE AGENCIES

5. The authority citation for 7 CFR Part 272 continues to read as follows:

Authority:

7 U.S.C. 2011-2036.

6. Section 272.8 is amended by adding a new paragraph (a)(5) to read as follows:

§ 272.8State income and eligibility verification system.

(a) * * *

(5) State agencies must provide information to FNS and to the State agencies administering the National School Lunch Program for the purpose of direct certification of children for school meals as described in § 245.12(c)(2) of this chapter. In addition, State agencies must execute a data exchange and privacy agreement in accordance with § 272.8(a)(4) and § 272.1(c).

Note:

Appendix A, a sample of a completed copy of the proposed form FNS-834,State Agency (NSLP/SNAP) Direct Certification Rate Data Element Report,will not be published in theCode of Federal Regulations.It is published here for informational purposes only.

Office of Energy Efficiency and Renewable Energy, Department of Energy.

ACTION:

Extension of public comment period.

SUMMARY:

This document announces an extension of the time period for submitting comments on the request for information pertaining to the development of test procedures and energy conservation standards for set-top boxes and network equipment. The comment period is extended to March 15, 2012.

DATES:

The comment period for the request for information relating to set-top boxes and network equipmentpublished on December 16, 2011 (76 FR 78174) is extended to March 15, 2012.

ADDRESSES:

Any comments submitted must identify the request for information for set-top boxes and network equipment and provide docket number EERE-2011-BT-NOA-0067 and/or RIN number 1904-AC52. Comments may be submitted using any of the following methods:

In the office of the General Counsel, contact Ms. Celia Sher, U.S. Department of Energy, Office of the General Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 287-6122. Email:Celia.Sher@hq.doe.gov.

SUPPLEMENTARY INFORMATION:

On December 16, 2011, The U.S. Department of Energy (DOE) published a request for information (RFI) in theFederal Register(76 FR 71874) to initiate a rulemaking and data collection process to develop a potential test procedure and energy conservation standard for set-top boxes and network equipment. The RFI requested public comment from interested parties regarding specific as well as general questions and provided for the submission of comments by February 14, 2012. Thereafter, AT&T Inc., on behalf of itself and its affiliates, requested an extension of the public comment period by a minimum of 30 days. AT&T stated that the additional time is necessary in order to fully evaluate and prepare the information requested in the RFI. AT&T noted that the information requested is complex and requires significant and essential input from AT&T engineering, product and technical personnel. Thus, AT&T asserted additional time is warranted to ensure quality responses to DOE's requests.

Based on AT&T's request, DOE believes that extending the comment period to allow additional time for interested parties to submit comments is appropriate. Therefore, DOE is extending the comment period until March 15, 2012 to provide interested parties additional time to prepare and submit comments. Accordingly, DOE will consider any comments received by March 15, 2012 to be timely submitted.

The FAA is correcting a Notice of Proposed Rulemaking (NPRM) that was published in theFederal Register. That NPRM applies to certain Pilatus Aircraft Ltd. Models PC-6, PC-6-H1, PC-6-H2, PC-6/350, PC-6/350-H1, PC-6/350-H2, PC-6/A, PC-6/A-H1, PC-6/A-H2, PC-6/B-H2, PC-6/B1-H2, PC-6/B2-H2, PC-6/B2-H4, PC-6/C-H2, and PC-6/C1-H2 airplanes. The Docket Number in the heading, in the Supplementary Information section, and in the Part 39—Airworthiness Directive section is incorrect. This document corrects that error. In all other respects, the original document remains the same.

DATES:

The last date for submitting comments to the NPRM (77 FR 2238, January 17, 2012) remains March 2, 2012.

ADDRESSES:

You may examine the AD docket on the Internet athttp://www.regulations.gov;or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: (800) 647-5527) is Document Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

As published, the Docket Number in the heading, in theSUPPLEMENTARY INFORMATIONsection, and in the Part 39—Airworthiness Directive section is incorrect.

No other part of the preamble or regulatory information has been changed; therefore, only the changed portion of the NPRM is being published in theFederal Register.

The last date for submitting comments to the NPRM remains March 2, 2012.

Correction of Non-Regulatory Text

In theFederal Registerof January 17, 2012, Directorate Identifier 2011-CE-042-AD is corrected as follows:

On page 2238, in the first column, on line 4 under the heading DEPARTMENT OF TRANSPORTATION, change Docket No. FAA-2011-0018 to “Docket No. FAA-2012-0018.”

On page 2238, in the third column, on line 12 under the headingSUPPLEMENTARY INFORMATION, change Docket No. FAA-2011-0018 to “Docket No. FAA-2012-0018.”

Correction of Regulatory Text§ 39.13[Corrected]

In theFederal Registerof January 17, 2012, on page 2239, in the second column, under the headingPART 39—AIRWORTHINESS DIRECTIVESof Directorate Identifier 2011-CE-042-AD is corrected to read as follows:

This action proposes to establish Class E airspace at Freer, TX. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Seven C's Ranch Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0901/Airspace Docket No. 11-ASW-12, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-(800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0901/Airspace Docket No. 11-ASW-12.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Seven C's Ranch Airport, Freer, TX. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Seven C's Ranch Airport, Freer, TX.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

That airspace extending upward from 700 feet above the surface within a 6.7-mile radius of Seven C's Ranch Airport, and within 2 miles each side of the 153° bearing from the airport extending from the 6.7-mile radius to 11.1 miles southeast of the airport, excluding that airspace within Restricted Area R-6312.

This action proposes to amend Class E airspace at Baraboo, WI. Additional controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Reedsburg Municipal Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport. The airport's geographic coordinates also would be adjusted.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-1403/Airspace Docket No. 11-ASW-29, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-(800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-1403/Airspace Docket No. 11-ASW-29.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by amending Class E airspace extending upward from 700 feet above the surface to accommodate new standard instrument approach procedures at Reedsburg Municipal Airport, Baraboo, WI. Geographic coordinates would also be amended to coincide with the FAA's aeronautical database. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that willonly affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend controlled airspace at Reedsburg Municipal Airport, Baraboo, WI.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

That airspace extending upward from 700 feet above the surface within a 9.6-mile radius of Baraboo Wisconsin Dells Airport, and within a 9.6-mile radius of Reedsburg Municipal Airport, and within 2 miles each side of the 180° bearing from Reedsburg Municipal Airport extending from the 9.6-mile radius to 10.5 miles south of the airport, and within an 8.7-mile radius of Portage Municipal Airport.

This action proposes to amend Class E airspace at Leesville, LA. Additional controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Leesville Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0608/Airspace Docket No. 11-ASW-6, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1 (800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0608/Airspace Docket No. 11-ASW-6.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by amending Class E airspace extending upward from 700 feet above the surface to accommodatenew standard instrument approach procedures at Leesville Airport, Leesville, LA. Geographic coordinates would also be amended to coincide with the FAA's aeronautical database. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend controlled airspace at Leesville Airport, Leesville, LA.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

That airspace extending upward from 700 feet above the surface within a 6.5-mile radius of Leesville Airport, and within 3.6 miles each side of the 345° bearing from the airport extending from the 6.5-mile radius to 12.2 miles north of the airport, and within 2.5 miles each side of the 000° bearing of the Leesville NDB extending from the 6.5-mile radius to 7.3 miles north of the airport, excluding that airspace within the Fort Polk, LA, Class D airspace area, and excluding that airspace within restricted area R-3803A.

This action proposes to amend Class E airspace at Maryville, MO. Decommissioning of the Emville non-directional beacon (NDB) at Northwest Missouri Regional Airport, Maryville, MO, has made this action necessary for the safety and management of Instrument Flight Rules (IFR) operations at Northwest Missouri Regional Airport. The airport's geographic coordinates also would be adjusted.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0434/Airspace Docket No. 11-ACE-9, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1 (800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0434/Airspace Docket No. 11-ACE-9.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m., and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by modifying Class E airspace extending upward from 700 feet above the surface for standard instrument approach procedures at Northwest Missouri Regional Airport, Maryville, MO. Airspace reconfiguration is necessary due to the decommissioning of the Emville NDB and the cancellation of the NDB approach. Geographic coordinates would also be updated to coincide with the FAA's aeronautical database. Controlled airspace is necessary for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would modify controlled airspace at Northwest Missouri Regional Airport, Maryville, MO.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to amend Class E airspace at Monahans, TX. Additional controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAPs) at Roy Hurd Memorial Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport. The airport's geographic coordinates also would be adjusted.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-1400/Airspace Docket No. 11-ASW-15, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-(800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-1400/Airspace Docket No. 11-ASW-15.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), part 71 by amending Class E airspace extending upward from 700 feet above the surface to accommodate new standard instrument approach procedures at Roy Hurd Memorial Airport, Monahans, TX. Geographic coordinates would also be adjusted to coincide with the FAA's aeronautical database. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend controlled airspace at Roy Hurd Memorial Airport, Monahans, TX.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

That airspace extending upward from 700 feet above the surface within a 6.4-mile radius of Roy Hurd Memorial Airport, and within 1.9 miles each side of the 127° bearing from the airport extending from the 6.4-mile radius to 9.8 miles southeast of the airport, and within 2 miles each side of the 307° bearing from the airport extending from the 6.4-mile radius to 9.6 miles northwest of the airport, and within 1.6 miles each side of the 136° radial of the Wink VORTAC extending from the 6.4-mile radius to 11 miles northwest of the airport.

This action proposes to amend Class E airspace at New Philadelphia, OH. Additional controlled airspace is necessary to accommodatenew Standard Instrument Approach Procedures (SIAP) at Harry Clever Field. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport. Also, the geographic coordinates of the airport would be amended.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0607/Airspace Docket No. 11-AGL-15, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1 (800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0607/Airspace Docket No. 11-AGL-15.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by amending Class E airspace extending upward from 700 feet above the surface to accommodate new standard instrument approach procedures at Harry Clever Field, New Philadelphia, OH. The airport's geographic coordinates also would be amended to coincide with the FAA's aeronautical database. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend controlled airspace at Harry Clever Field, New Philadelphia, OH.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

That airspace extending upward from 700 feet above the surface within a 6.4-mile radius of Harry Clever Field Airport, and within 2 miles each side of the 319° bearingfrom the airport extending from the 6.4-mile radius to 11.2 miles northwest of the airport.

This action proposes to amend Class E airspace at Springhill, LA. Decommissioning of the Springhill non-directional beacon (NDB) at Springhill Airport, Springhill, LA, has made this action necessary for the safety and management of Instrument Flight Rules (IFR) operations at Springhill Airport. The geographic coordinates of the airport also would be amended.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0847/Airspace Docket No. 11-ASW-11, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-800-647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0847/Airspace Docket No. 11-ASW-11.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m., and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd. Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by modifying Class E airspace extending upward from 700 feet above the surface for standard instrument approach procedures at Springhill Airport, Springhill, LA. Airspace reconfiguration is necessary due to the decommissioning of the Springhill NDB and the cancellation of the NDB approach. This action would also amend the geographic coordinates of the airport to coincide with the FAA's aeronautical database. Controlled airspace is necessary for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would modify controlled airspace at Springhill Airport, Springhill, LA.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to amend Class E airspace at Tobe, CO. Decommissioning of the Tobe Tactical Air Navigation System (TACAN) has made this action necessary for the safety and management of Instrument Flight Rules (IFR) operations in the vicinity of the Tobe Very High Frequency Omni-Directional Radio Range/Distance Measuring Equipment (VOR/DME).

DATES:

Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590; telephone (202) 366-9826. You must identify FAA Docket No. FAA-2011-1338; Airspace Docket No. 11-ANM-27, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (FAA Docket No. FAA-2011-1338 and Airspace Docket No. 11-ANM-27) and be submitted in triplicate to the Docket Management System (see “ADDRESSES” section for address and phone number). You may also submit comments through the Internet athttp://www.regulations.gov.

Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2011-1338 and Airspace Docket No. 11-ANM-27.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see theADDRESSESsection for the address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the Northwest Mountain Regional Office of the Federal Aviation Administration, Air Traffic Organization, Western Service Center, Operations Support Group, 1601 Lind Avenue SW., Renton, WA 98057.

Persons interested in being placed on a mailing list for future NPRM's should contact the FAA's Office of Rulemaking, (202) 267-9677, for a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) Part 71 by amending Class E airspace extending upward from 8,500 feet Mean Sea Level (MSL) in the vicinity of the Tobe VOR/DME. Airspace reconfiguration is necessary due to the decommissioning to the Tobe TACAN. This action would enhance the safety and management of aircraft operations in the vicinity of the Tobe VOR/DME, CO.

Class E airspace designations are published in paragraph 6005, of FAA Order 7400.9V, dated August 9, 2011, and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document will be published subsequently in this Order.

The FAA has determined this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this proposed regulation; (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified this proposed rule, whenpromulgated, would not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106, describes the authority for the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would modify controlled airspace at Tobe, CO.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

1. The authority citation for 14 CFR part 71 continues to read as follows:

2. The incorporation by reference in 14 CFR 71.1 of the Federal Aviation Administration Order 7400.9V, Airspace Designations and Reporting Points, dated August 9, 2011, and effective September 15, 2011 is amended as follows:

This action proposes to establish Class E airspace at Branson West, MO. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Branson West Municipal—Emerson Field Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0749/Airspace Docket No. 11-ACE-15, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-(800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0749/Airspace Docket No. 11-ACE-15.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (see “ADDRESSES” section for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Branson West Municipal—Emerson Field Airport, Branson West, MO.Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Branson West Municipal-Emerson Field Airport, Branson West, MO.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to establish Class E airspace at Eldon, MO. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Eldon Model Airpark. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-1104/Airspace Docket No. 11-ACE-21, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-(800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-1104/Airspace Docket No. 11-ACE-21.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov.Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition inperson in the Dockets Office (seeADDRESSESsection for address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Eldon Model Airpark, Eldon, MO. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Eldon Model Airpark, Eldon, MO.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (Air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to establish Class E airspace at Houston, MO. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Houston Memorial Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0903/Airspace Docket No. 11-ACE-20, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1 (800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic,environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0903/Airspace Docket No. 11-ACE-20.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Houston Memorial Airport, Houston, MO. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Houston Memorial Airport, Houston, MO.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to establish Class E airspace at Pender, NE. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Pender Municipal Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-1103/Airspace Docket No. 11-ACE-14, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov.You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1-800-647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-1103/Airspace Docket No. 11-ACE-14.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Pender Municipal Airport, Pender, NE. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Pender Municipal Airport, Pender, NE.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to establish Class E airspace at Red Cloud, NE. Controlled airspace is necessary to accommodate new Standard Instrument Approach Procedures (SIAP) at Red Cloud Municipal Airport. The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations for SIAPs at the airport.

DATES:

0901 UTC. Comments must be received on or before March 16, 2012.

ADDRESSES:

Send comments on this proposal to the U.S. Department ofTransportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590-0001. You must identify the docket number FAA-2011-0426/Airspace Docket No. 11-ACE-7, at the beginning of your comments. You may also submit comments through the Internet athttp://www.regulations.gov. You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone 1 (800) 647-5527), is on the ground floor of the building at the above address.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2011-0426/Airspace Docket No. 11-ACE-7.” The postcard will be date/time stamped and returned to the commenter.

Availability of NPRMs

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's Web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (seeADDRESSESsection for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Central Service Center, 2601 Meacham Blvd., Fort Worth, TX 76137.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking (202) 267-9677, to request a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Proposal

This action proposes to amend Title 14, Code of Federal Regulations (14 CFR), Part 71 by establishing Class E airspace extending upward from 700 feet above the surface for new standard instrument approach procedures at Red Cloud Municipal Airport, Red Cloud, NE. Controlled airspace is needed for the safety and management of IFR operations at the airport.

Class E airspace areas are published in Paragraph 6005 of FAA Order 7400.9V, dated August 9, 2011 and effective September 15, 2011, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document would be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore, (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would establish controlled airspace at Red Cloud Municipal Airport, Red Cloud, NE.

List of Subjects in 14 CFR Part 71

Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

This action proposes to amend the NIGC's self-regulation regulations to tailor the self-regulating qualifying criteria to a tribe's regulation of class II gaming activity and more clearly define and streamline the self-regulation certification process. By tailoring the self-regulating qualifying criteria to the capabilities of a tribe's regulatory body, and by clarifying and streamlining the certification process, more tribes may become self-regulating.

DATES:

The agency must receive comments on or before April 2, 2012.

ADDRESSES:

You may submit comments by any one of the following methods, but please note that comments sent by electronic mail are strongly encouraged.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments which provide a factual basis in support of the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal.

II. Background

On November 18, 2010, the Commission issued a Notice of Inquiry and Notice of Consultation (“NOI”) advising the public that the NIGC was conducting a comprehensive review of its regulations and requesting public comment on which of its regulations were most in need of revision, in what order the NIGC should review its regulations, and the process the NIGC should utilize to make revisions. 75 FR 70680 (Nov. 18, 2010). On April 4, 2011, after holding eight consultations and reviewing all of the comments, the Commission published a Notice of Regulatory Review Schedule, setting out a consultation schedule and process for review. 76 FR 18457. Part 518 is included in one of the regulation groups that are part of this regulatory review.

III. Development of the Proposed Rule

The Commission conducted numerous tribal consultations as part of its review of part 518—Self-Regulation of Class II Gaming. Tribal consultations were held in every region of the country and were attended by many tribal leaders or their representatives. In addition to tribal consultations, on August 16, 2011, the Commission requested public comment on a Preliminary Draft of part 518. After considering the comments received from the public, and through tribal consultations, the Commission proposes to amend part 518 to (a) tailor the self-regulating criteria to a tribe's regulation of class II gaming activity; and (b) clearly define and streamline the process by which a self-regulation petition is reviewed and a final determination is made by the Commission.

IV. Overview of the Proposed Rule

During the regulation review process, the Commission received comments that the existing self-regulation regulation discourages participation because the burdens imposed by the regulation outweigh the benefits. Specifically, comments stated that the current process is confusing, and the submission requirements, and continuing compliance requirements, are redundant and intrusive. The Commission also received comments that the current process is misfocused by placing greater emphasis on a tribe's gaming operation than on the effectiveness of a tribe's regulatory system. Therefore, the Commission is proposing amendments to streamline and clarify the process, as well as to ensure an effective regulatory framework for self-regulating tribes.

The proposed rule amends the petition and approval process to focus on the capability of the tribal regulatory body. To this end, the proposed rule requires information necessary for the Commission to evaluate the strength and effectiveness of a tribe's regulation of its gaming activity.

The proposed rule clarifies both the initial eligibility requirements and the petition submission requirements. Further, the proposed rule eliminates the need to resubmit information already provided to either the NIGC or the Bureau of Indian Affairs (“BIA”), such as gaming regulations, constitutions, revenue allocation plans, and facility licenses. The proposed rule creates distinct stages and timelines for the certification process, and accelerates the timeline for the Commission to issue a final decision. The proposed rule provides for a streamlined process by involving the Commission in the certification review process. Under the proposed rule, the Commission will issue both the preliminary findings and final determination as to whether a tribe meets the approval criteria for self-regulation. The Commission will also hold a hearing, if requested by a tribe upon receipt of the Commission's preliminary findings.

Once certified, the only annual submission requirements under the proposed rule are the submission of independent audits and the resumes of all employees hired and licensed by the tribe's gaming regulatory body. The Commission believes that the annual self-regulation report currently required provides duplicative information already available to the agency and therefore proposes to eliminate that requirement. Additionally, the proposed rule requires self-regulating tribes to notify the NIGC within three business days of any change in circumstances that is material to the requirements for issuance of a certificate of self-regulation. This self-reporting requirement will provide the Commission with essential information in a more timely manner than the annual report mechanism in the current regulations.

Responses to the NOI and the Preliminary Draft of part 518 were generally positive. Many commenters stated that, in its current form, part 518 should be reviewed and revised to facilitate self-regulation while maintaining stringent standards. A commenter stated that the self-regulation regulations should be about evaluating a tribe's regulatory agency, not the gaming operation. Another commenter agreed, stating the focus should be on the tribal regulatory agency, not the gaming operation. Other commenters noted that the current financial benefits of waived fees do not outweigh the paperwork burdens of the current regulations. One commenter noted that the promise of self-regulation contemplated by the Act is not fulfilled by the NIGC's current regulations. Another commenter stated that the fact that only two tribes are self-regulating means something is wrong with theregulations. As noted above, the Commission's proposed changes attempt to address many of these concerns.

B. Eligibility and Submission Requirements for Petition

The statute identifies who is eligible to petition for a certificate of self-regulation, and those criteria are contained in § 518.2 of the current regulation. The proposed rule attempts to clearly identify what a tribe is required to include in its petition at the time it is submitted to the NIGC, including evidence that the tribe meets the statutory eligibility requirements.

The requirement that a tribe must have continuously conducted class II gaming activity for the 3-year period immediately preceding the date of the petition raised concerns by several commenters. Commenters stated that this requirement could make ineligible those tribes conducting both class II and class III gaming, but which have not continuously conducted class II gaming for a 3-year period prior to submitting a petition. Commenters stated that if a tribe has conducted, and successfully regulated class II and/or class III gaming for three years, then it should be eligible to petition for a certificate of self-regulation. Further, there are instances in which tribes operate their gaming facilities seasonally or in which tribes have to temporarily close their facilities. While the Commission understands the perspective of the commenters, IGRA requires a tribe to continuously conduct class II gaming activity for three years before submitting a petition for self-regulation. Accordingly, and in light of the comments received, the Commission will continue to interpret the phrase “continuously conducted” in a way consistent with the common-sense interpretation found in the preamble to the existing rule at 63 FR 41961 (August 6, 1998). Likewise, this Commission does not intend to preclude a tribe from obtaining a certificate of self-regulation if its gaming operation is closed for temporary or seasonal closures, and will evaluate each situation on a case-by-case basis. Commenters noted that the current rule requires submission of information that is more focused on the gaming operation than the gaming regulatory framework. The Commission agrees with this comment and has attempted to strengthen the submission requirements that would indicate whether a tribe was successfully regulating its gaming activities, such as the criteria used for hiring tribal regulatory agency employees and a list of the gaming activity internal controls in place at the gaming operation. Under the proposed rule, tribes will be required to provide a list of their internal controls as part of the petition. Additionally, tribes must only submit the gaming regulations with the petition if the gaming regulations are not part of the gaming ordinance previously submitted and approved by the Chair.

Further, commenters also noted that requiring information such as a tribe's constitution, revenue allocation plan or facility license is duplicative, as these documents have already been submitted to the NIGC or the BIA. The Commission agrees with this observation and has attempted to streamline the certification process by removing the requirements to resubmit documents previously provided to the NIGC or the BIA.

C. Criteria That Must Be Met To Receive a Certificate of Self-Regulation

The statute establishes criteria that must be met by a tribe before a certificate of self-regulation can be issued. The current rule identifies those criteria and provides a list of “indicators” that a tribe may use to demonstrate they have met the criteria. The proposed rule clarifies that the examples listed are not all-inclusive and that a tribe can provide other evidence to satisfy the criteria. As discussed above, the proposed rule focuses on evidence related to the tribe's regulation of the gaming activity. The proposed rule also streamlines criteria addressed by other NIGC regulations, such as compliance with applicable building, health and safety codes and procedures for resolving disputes between the gaming public and the tribe. Those requirements are addressed in Parts 559 and 522, respectively.

D. Process for Petition Review and Certification of Tribes

Several tribes commented that the timing and process for certification needs clarification. In response, the proposed rule attempts to simplify and streamline the certification process, including how petitions are submitted, reviewed and approved, and the timelines for each stage. The proposed rule also attempts to clarify the respective roles and responsibilities of the Commission and the Office of Self-Regulation (“OSR”). The current regulation authorizes the OSR to administer the self-regulation program and receive, review and approve petitions. Commenters stated that IGRA requires the Commission itself to consider petitions and certify qualifying tribes. The proposed rule modifies the roles of the OSR and the Commission by requiring the full Commission to make the final determination as to whether a tribe meets the approval criteria for self-regulation, based on information presented in the tribe's petition, supplemental documentation and a hearing, if held. The proposed rule also streamlines the process by requiring the Commission to issue preliminary findings to the tribe and provide the tribe with an opportunity for a hearing before the Commission issues a final determination. This change allows a tribe to respond to a preliminary adverse finding before a final determination by the Commission. This proposed process is intended to facilitate collaboration with the NIGC to meet the approval criteria. Finally, the proposed rule provides for judicial review in a more timely manner than the current regulations.

E. Post-Certification Rights and Responsibilities

IGRA requires a tribe which has been issued a certificate of self-regulation to submit an independent annual audit and a complete resume on all employees hired and licensed by the tribe. The proposed rule requires self-regulating tribes to submit, on an annual basis, an independent audit and the resumes of employees hired and licensed by the tribal gaming regulatory body. Some commenters requested the regulation include a definition of “tribal regulator.” The proposed rule does not define “tribal regulator” because tribal law may vary on how it defines a tribal regulator. In order to account for all persons responsible for the regulation of a tribes' class II gaming activity, without interfering with the tribe's interpretation of a “tribal regulator,” the proposed rule requires self-regulating tribes to submit, on an annual basis, the resumes of all employees hired and licensed by the tribal gaming regulatory body. The Commission invites comment on this approach and comment on potential definitions of “tribal regulator.”

Part 518 currently requires the tribe to submit an annual report to establish that the tribe has continuously met the eligibility and approval requirements. The proposed rule reduces this paperwork burden. The proposed rule requires a tribe to notify the NIGC within three business days of any change in circumstances that is material to meeting the requirements for issuance of the certificate. This approach will ensure timely reporting to maintain the integrity of Indian gaming while reducing paperwork requirements for the regulated community.

Finally, commenters stated that the current regulations concerning the NIGC's enforcement powers over self-regulating tribes were unclear and overbroad. Consistent with public comments, the proposed rule corrects and clarifies § 518.9 by referencing the powers of the NIGC that are limited by statute once a tribe is issued a certificate of self-regulation

Regulatory MattersRegulatory Flexibility Act

This proposed rule will not have a significant economic effect on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601et seq.Indian tribes are not considered to be small entities for purposes of the Regulatory Flexibility Act.

Small Business Regulatory Enforcement Fairness Act

This proposed rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule does not have an annual effect on the economy of $100 million or more. This rule will not cause a major increase in costs or prices for consumers, individual industries, Federal, state or local government agencies or geographic regions, and does not have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.

Unfunded Mandate Reform Act

The Commission, as an independent regulatory agency within the Department of the Interior, is exempt from compliance with the Unfunded Mandates Reform Act. 2 U.S.C. 1502(1); 2 U.S.C. 658(1).

Takings

In accordance with Executive Order 12630, the Commission has determined that this proposed rule does not have significant takings implications. A takings implication assessment is not required.

Civil Justice Reform

In accordance with Executive Order 12988, the Office of General Counsel has determined that the proposed rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Executive Order.

National Environmental Policy Act

The Commission has determined that this proposed rule does not constitute a major Federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4321et seq.

Paperwork Reduction Act

This proposed rule requires information collection under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501,et seq.,and is, therefore, subject to review by the Office of Management and Budget.

Accordingly, for the reasons discussed in the preamble, the Commission proposes to revise 25 CFR part 518 to read as follows:

PART 518—SELF-REGULATION OF CLASS II GAMINGSec.518.1What does this part cover?518.2Who will administer the self-regulation program for the Commission?518.3Who is eligible to petition for a certificate of self-regulation?518.4What must a tribe submit to the Commission as part of its petition?518.5What criteria must a tribe meet to receive a certificate of self-regulation?518.6What are the responsibilities of the Office of Self-Regulation in the certification process?518.7What process will the Commission use to review and certify petitions?518.8What is the hearing process?518.9When will a certificate of self-regulation become effective?518.10What must a self-regulating tribe provide the Commission to maintain its self-regulatory status?518.11Does a tribe that holds a certificate of self-regulation have a continuing duty to advise the Commission of any additional information?518.12Which investigative or enforcement powers of the Commission are inapplicable to self-regulating tribes?518.13When may the Commission revoke a certificate of self-regulation?518.14May a tribe request a hearing on the Commission's proposal to revoke its certificate of self-regulation?Authority:

25 U.S.C. 2706(b)(10); E.O. 13175.

§ 518.1What does this part cover?

This part sets forth requirements for obtaining a certificate of self-regulation of class II gaming operations under 25 U.S.C. 2710(c). When the Commission issues a certificate of self-regulation, the certificate is issued to the tribe, not to a particular gaming operation. The certificate applies to all class II gaming activity conducted by the tribe holding the certificate.

§ 518.2Who will administer the self-regulation program for the Commission?

The self-regulation program will be administered by the Office of Self-Regulation. The Chair shall appoint one Commissioner to administer the Office of Self-Regulation.

§ 518.3Who is eligible to petition for a certificate of self-regulation?

A tribe is eligible to petition the Commission for a certificate of self-regulation of class II gaming if, for a three (3)-year period immediately preceding the date of its petition:

(a) The tribe has continuously conducted such gaming;

(b) All gaming that the tribe has engaged in, or has licensed and regulated, on Indian lands within the tribe's jurisdiction, is located within a State that permits such gaming for any purpose by any person, organization or entity (and such gaming is not otherwise specifically prohibited on Indian lands by Federal law), in accordance with 25 U.S.C. 2710(b)(1)(A);

(c) The governing body of the tribe has adopted an ordinance or resolution that the Chair has approved, in accordance with 25 U.S.C. 2710(b)(1)(B);

(d) The tribe has otherwise complied with the provisions of 25 U.S.C. 2710; and

(e) The gaming operation and the tribal regulatory body have, for the three (3) years immediately preceding the date of the petition, maintained all records required to support the petition for self-regulation.

§ 518.4What must a tribe submit to the Commission as part of its petition?

A petition for a certificate of self-regulation is complete under this part when it contains:

(a) Two copies on 81/2″ x 11″ paper of a petition for self-regulation approved by the governing body of the tribe and certified as authentic by an authorized tribal official;

(b) A description of how the tribe meets the eligibility criteria in § 518.3, which may include supporting documentation; and

(c) The following information with supporting documentation:

(i) A brief history of each gaming operation(s), including the opening dates and periods of voluntary or involuntary closure;

(ii) An organizational chart of the tribal regulatory body;

(iii) A brief description of the criteria tribal regulators must meet before being eligible for employment as a tribal regulator;

(iv) A brief description of the process by which the tribal regulatory body isfunded, and the funding level for the three years immediately preceding the date of the petition;

(v) A list of the current regulators and employees of the tribal regulatory body, their complete resumes, their titles, the dates they began employment, and, if serving limited terms, the expiration date of such terms;

(vi) A brief description of the accounting system(s) at the gaming operation which tracks the flow of the gaming revenues;

(vii) A list of gaming activity internal controls at the gaming operation(s);

(viii) A description of the record keeping system(s) for all investigations, enforcement actions, and prosecutions of violations of the tribal gaming ordinance or regulations, for the three (3)-year period immediately preceding the date of the petition; and

(ix) The tribe's current set of gaming regulations, if not included in the approved tribal gaming ordinance.

§ 518.5What criteria must a tribe meet to receive a certificate of self-regulation?

(a) The Commission shall issue a certificate of self-regulation if it determines that for a three (3)-year period, the tribe has:

(1) Conducted its gaming activity in a manner that:

(i) Has resulted in an effective and honest accounting of all revenues;

(ii) Has resulted in a reputation for safe, fair, and honest operation of the activity; and

(iii) Has been generally free of evidence of criminal or dishonest activity;

(2) Conducted its gaming operation on a fiscally and economically sound basis;

(3) Conducted its gaming activity in compliance with the IGRA, NIGC regulations in this chapter, and the tribe's gaming ordinance and gaming regulations; and

(4) Adopted and is implementing adequate systems for:

(i) Accounting of all revenues from the gaming activity;

(ii) Investigating, licensing and monitoring of all employees of the gaming activity;

(iii) Investigating, enforcing, prosecuting, or referring for prosecution violations of its gaming ordinance and regulations; and

(iv) Prosecuting criminal or dishonest activity or referring such activity for prosecution.

(b) A tribe may illustrate that it has met the criteria listed in paragraph (a) of this section by addressing factors such as those listed below. The list of factors is not all-inclusive; other factors not listed here may also be addressed and considered.

(1) The tribe adopted and is implementing minimum internal control standards which are at least as stringent as those promulgated by the Commission;

(2) The tribe requires tribal gaming regulators to meet the same suitability requirements as those required for key employees and primary management officials of the gaming operation(s);

(3) The tribe's gaming operation utilizes an adequate system for accounting of all gaming revenues from class II gaming activity;

(4) The tribe has a dispute resolution process for gaming operation customers and has taken steps to ensure that the process is adequately implemented;

(v) Has access to and may inspect, examine, photocopy and audit all papers, books, and records of the gaming operation(s) and class II gaming activities;

(vi) Monitors compliance with minimum internal control standards for the gaming operation;

(vii) Has adopted and is implementing an adequate system for investigating, licensing, and monitoring of all employees of the gaming activity;

(viii) Maintains records on licensees and on persons denied licenses, including persons otherwise prohibited from engaging in gaming activities within the tribe's jurisdiction;

(ix) Establishes standards for, and issues, vendor licenses or permits to persons or entities who deal with the gaming operation, such as manufacturers and suppliers of services, equipment and supplies;

(6) The tribe allocates and appropriates a sufficient source of permanent and stable funding for the tribal regulatory body;

(7) The tribe has adopted and is implementing a conflict of interest policy for the regulators/regulatory body and their staff;

(8) The tribe has adopted and is implementing a system for adequate prosecution of violations of the tribal gaming ordinance and regulations or referrals for prosecution; and

(9) The tribe demonstrates that the operation is being conducted in a manner which adequately protects the environment and the public health and safety.

(c) The tribe assists the Commission with access and information-gathering responsibilities during the certification process.

(d) The burden of establishing self-regulation is upon the tribe filing the petition.

§ 518.6What are the responsibilities of the Office of Self-Regulation in the certification process?

The Office of Self-Regulation shall be responsible for directing and coordinating the certification process. It shall provide a written report and recommendation to the Commission as to whether a certificate of self-regulation should be issued or denied, and a copy of the report and recommendation to the petitioning tribe.

§ 518.7What process will the Commission use to review and certify petitions?

(a) Petitions for self-regulation shall be submitted by tribes to the Office of Self-Regulation.

(1) Within 30 days of receipt of a tribe's petition, the Office of Self-Regulation shall conduct a review of the tribe's petition to determine whether it is complete under § 518.4.

(2) If the tribe's petition is incomplete, the Office of Self-Regulation shall notify the tribe by letter, certified mail or return receipt requested, of any obvious deficiencies or significant omissions in the petition. A tribe with an incomplete petition may submit additional information and/or clarification within 30 days of receipt of notice of an incomplete petition.

(3) If the tribe's petition is complete, the Office of Self-Regulation shall notify the tribe in writing.

(b) Once a tribe's petition is complete, the Office of Self-Regulation shall conduct a review to determine whether the tribe meets the eligibility criteria in § 518.3 and the approval criteria in § 518.5. During its review, the Office of Self-Regulation:

(1) May request from the tribe any additional material it deems necessary to assess whether the tribe has met the criteria for self-regulation.

(2) Will coordinate an on-site review and verification of the information submitted by the petitioning tribe.

(c) Within 120 days of notice of a complete petition under § 518.4, the Office of Self-Regulation shall provide a recommendation and written report to the full Commission and the petitioning tribe.

(1) If the Office of Self-Regulation determines that the tribe has satisfied the criteria for a certificate of self-regulation, it shall recommend to the Commission that a certificate be issued to the tribe.

(2) If the Office of Self-Regulation determines that the tribe has not met the criteria for a certificate of self-regulation, it shall recommend to the Commission that it not issue a certificate to the tribe.

(3) The Office of Self-Regulation shall make all information on which it relies in making its recommendation and report available to the tribe, subject to the confidentiality requirements in 25 U.S.C. 2716(a), and shall afford the tribe an opportunity to respond.

(4) The report shall include:

(i) Findings as to whether each of the eligibility criteria is met, and a summary of the basis for each finding;

(ii) Findings as to whether each of the approval criteria is met, and a summary of the basis for each finding;

(iii) A recommendation to the Commission as to whether it should issue the tribe a certificate of self-regulation; and

(iv) A list of any documents and other information received in support of the tribe's petition.

(5) A tribe shall have 30 days from the date of issuance of the report to submit to the Office of Self-Regulation a response to the report.

(d) After receiving the Office of Self-Regulation's recommendation and report, and a tribe's response to the report, the Commission shall issue preliminary findings as to whether the eligibility and approval criteria are met. The Commission's preliminary findings will be provided to the tribe within 30 days of receipt of the report.

(e) Upon receipt of the Commission's preliminary findings, the tribe can request, in writing, a hearing before the Commission, as set forth in § 518.8. Hearing requests shall be made to the Office of Self-Regulation and shall specify the issues to be addressed by the tribe at the hearing, and any proposed oral or written testimony the tribe wishes to present.

(f) The Commission shall issue a final determination 30 days after issuance of its preliminary findings or after the conclusion of a hearing, if one is held. The decision of the Commission to approve or deny a petition shall be a final agency action.

(g) A tribe may withdraw its petition and resubmit it at any time prior to the issuance of the Commission's final determination.

§ 518.8What is the hearing process?

(a) Within 10 days of receipt of the request for a hearing, the Office of Self-Regulation shall notify the tribe of the date and place of the hearing. The notice shall also set a hearing schedule, the time allotted for testimony and oral argument, and the order of the presentation. To the extent possible, the hearing will be scheduled not later than 60 days after the notice is issued, and the hearing schedule will be issued at least 30 days prior to the hearing.

(b) The Commission shall issue a decision on the petition within 30 days after the hearing's conclusion. The decision shall set forth, with particularity, findings regarding the tribe's satisfaction of the self-regulation standards in this part. If the Commission determines that a certificate will issue, it will do so in accordance with § 518.11.

(c) The decision of the Commission to approve or deny a petition shall be a final agency action.

§ 518.9When will a certificate of self-regulation become effective?

A certificate of self-regulation shall become effective on January 1 of the year following the year in which the Commission determines that a certificate will issue. Petitions will be reviewed in chronological order based on the date of receipt of a complete petition.

§ 518.10What must a self-regulating tribe provide the Commission to maintain its self-regulatory status?

(a) Each tribe that holds a certificate of self-regulation shall be required to submit the following information on April 15 of each year following the first year of self-regulation or within 120 days after the end of each fiscal year of the gaming operation, as required by 25 CFR 571.13:

(1) An annual independent audit, to be filed with the Commission, as required by 25 U.S.C. 2710(b)(2)(c); and

(2) A complete resume for all employees of the tribal regulatory body hired and licensed by the tribe subsequent to its receipt of a certificate of self-regulation, to be filed with the Office of Self-Regulation.

(b) Failure to submit the information required by this section may result in revocation of a certificate of self-regulation.

§ 518.11Does a tribe that holds a certificate of self-regulation have a continuing duty to advise the Commission of any additional information?

Yes. A tribe that holds a certificate of self-regulation has a continuing duty to advise the Commission within three (3) business days of any changes in circumstances that are material to the approval criteria in § 518.5 and may reasonably cause the Commission to review and revoke the tribe's certificate of self-regulation. Failure to do so is grounds for revocation of a certificate of self-regulation. Such circumstances may include, but are not limited to, a change in management contractor; a change of primary regulatory official; financial instability; or any other factors that are material to the decision to grant a certificate of self-regulation.

§ 518.12Which investigative or enforcement powers of the Commission are inapplicable to self-regulating tribes?

During any time in which a tribe has a certificate of self-regulation, the powers of the Commission, as set forth in 25 U.S.C. 2706(b)(1)-(4), shall be inapplicable.

§ 518.13When may the Commission revoke a certificate of self-regulation?

The Commission may, after an opportunity for a hearing, revoke a certificate of self-regulation by a majority vote of its members if it determines that the tribe no longer meets the eligibility criteria of § 518.3, the approval criteria of § 518.5, the requirements of § 518.10 or the requirements of § 518.11. The Commission shall provide the tribe with prompt notice of the Commission's intent to revoke a certificate of self-regulation under this part. Such notice shall state the reasons for the Commission's action and shall advise the tribe of its right to a hearing under part 584 or right to appeal under part 585. The decision to revoke a certificate is a final agency action and is appealable to Federal District Court pursuant to 25 U.S.C. 2714.

§ 518.14May a tribe request a hearing on the Commission's proposal to revoke its certificate of self-regulation?

Yes. A tribe may request a hearing regarding the Commission's proposal to revoke a certificate of self-regulation. Such a request shall be filed with the Commission pursuant to part 584. Failure to request a hearing within the time provided by part 584 shallconstitute a waiver of the right to a hearing.

The National Indian Gaming Commission proposes to add a new subchapter to its regulations to create a clear process for appeal proceedings before the Commission. It would, among other things, define certain terms, set forth the burden of proof and standard of review, explain what information a Commission decision will contain, and what happens if the Commission does not issue a majority decision, and provide that an appeal of the Chair's decision does not stay the effect of that decision. The proposed regulations set forth rules for motion practice in appeals before the Commission, addresses how an entity other than a tribe would request to participate on a limited basis in ordinance appeals, how parties file motions to intervene, to supplement the record, and for reconsideration, and how to file motions before the presiding official. Additionally, the proposed regulation sets forth more specific rules for different types of appeals. Rules for appeals of ordinance disapprovals, management contract approvals and disapprovals, appeals before a presiding official, and appeals before the Commission on written submission only each receive somewhat different treatment.

DATES:

The agency must receive comments on or before April 2, 2012.

ADDRESSES:

You may submit comments by any one of the following methods, however, please note that comments sent by electronic mail are strongly encouraged.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal.

II. Background

On November 18, 2010, the National Indian Gaming Commission (NIGC) issued a Notice of Inquiry and Notice of Consultation (NOI) advising the public that the NIGC was conducting a comprehensive review of its regulations and requesting public comment on which of its regulations were most in need of revision, in what order the Commission should review its regulations, and the process NIGC should utilize to make revisions. 75 FR 70680 (Nov. 18, 2010). On April 4, 2011, after holding eight consultations and reviewing all comments, NIGC published a Notice of Regulatory Review Schedule (NRR) setting out a consultation schedule and process for review. 76 FR 18457. The Commission's regulatory review process established a tribal consultation schedule with a description of the regulation groups to be covered at each consultation. Part 519—Service; Part 524—Appeals; Part 539—Appeals; and Part 577—Appeals before the Commission were included in this regulatory review. The Commission will address changes to part 519—Service in a separate rulemaking action because part 519 sets forth rules for service of actions and decisions by the Chair and therefore does not implicate the appellate review process.

III. Development of the Proposed Rule

The Commission conducted a total of 10 tribal consultations as part of its review of Part 519—Service; Part 524—Appeals; Part 539—Appeals; and Part 577—Appeals before the Commission. Tribal consultations were held in every region of the country and were attended by numerous tribes and tribal leaders or their representatives. In addition to tribal consultations, on July 22, 2011, the Commission requested public comment on a Preliminary Draft of new Subchapter H. After considering the comments received from the public and through tribal consultations, the Commission will remove Part 524—Appeals; Part 539—Appeals; and Part 577—Appeals before the Commission and will add a new subchapter H—Appeal Proceedings before the Commission.

Currently, rules for appeals before the Commission are found in three separate places: Part 524 governs appeals of ordinance actions; part 539 addresses appeals of management contract actions; and part 577 sets forth procedures for appeals of enforcement actions and actions to void an approved management contract. The Commission believes that consolidating all appellate procedures in a new subchapter promotes clarity and effectiveness for the regulated community.

Proposed subchapter H consists of six parts: 580—Rules of general application in appellate proceedings before the Commission; 581—Motions in appellate proceedings before the Commission ; 582—Appeals of disapprovals of gaming ordinances, resolutions, or amendments.; 583—Appeals of approvals or disapprovals of management contracts or amendments to management contracts; 584—Appeals before a presiding official of notices of violation, proposed civil fine assessments, orders of temporary closure, the Chair's decision to void or modify a management contracts, the Commission's proposal to remove a certificate of self-regulation, and notices of late fees and late fee assessments; and 585—Appeals to the Commission on written submissions of notices of violation, proposed civil fine assessments, orders of temporary closure, the Chair's decision to void or modify management contracts, the Commission's proposal to remove a certificate of self regulation, and notices of late fees and late fee assessments.

Part 580—Rules of General Application in Appeal Proceedings Before the Commission

This new part sets forth rules that are generally applicable to all appellate proceedings before the Commission. First, it defines terms used throughout the subchapter. Several commenterssuggested that the terms “limited participant” and “presiding official” be defined. The Commission has defined those terms. Other terms commenters suggested be defined are “petition”, “leave”, “motion”, “movant”, and “brief.” The Commission believes that these terms are generally understood and has chosen not to define them. The Commission has also defined the terms “day”, “de novo review”, “preponderance of the evidence”, “proceeding”, and “summary proceeding.”

In the Preliminary Draft, several of these generally applicable sections were repeated throughout the regulations. One commenter suggested that, to reduce redundancy, those sections should be stated only once. The Commission agrees and has removed the redundancies and grouped those generally applicable sections here.

A commenter suggested that the Commission utilize a tribal advisory committee to develop these regulations. While the Commission has used advisory committees in the past, it choose not to do so here. Advisory committees are best utilized for technical issues or where tribes might have particular experience or a unique perspective. The Commission acknowledges that Tribes and their representatives have valuable information to contribute to this regulation, as repeatedly demonstrated during the consultation process. We believe, though, that the best way to ensure that all of the comments throughout Indian country, as well as the public at large, are considered, is to develop the regulations through notice and comment rulemaking.

Part 580 includes a section entitled “When may the Commission suspend, revoke, amend, or waive its rules governing proceedings before the Commission?”, and provides that the Commission may do so in certain circumstances for good cause shown, if the interest of justice so requires. This provision allows flexibility in situations where adherence to the rules would work an injustice or would impair the orderly conduct of the proceedings.

Part 580 also includes a section which explains who may appear before the Commission. One commenter suggested the language in the Preliminary Draft was too restrictive and did not allow for representation by an advocate who was not an attorney admitted to practice in a Federal court. The Commission revised the language to allow for representation by an attorney or other authorized representative, and included attorneys licensed to practice in tribal courts.

Existing section 577.6 addresses service of documents by appellants in appeals before the Commission regarding notices of violation, civil fines, temporary closure orders, and decisions to void or modify a management contracts. There are currently no rules of service by appellants in actions other than those governed by section 577.6. As a result, appellants in ordinance disapprovals and management contract actions have in practice relied on the existing service rules for all appeals. Proposed part 580 improves the rules of services and makes them generally applicable.

Proposed part 580 requires that copies of the notice of appeal and appeal brief shall be filed personally or by registered or certified mail, return receipt requested. All subsequent documents shall be served personally, by facsimile, by email to an address designated by a Commission employee, or by first class mail. This is a change from § 577.6, which allows notices of appeal and appeal briefs to be filed via these methods and also via fax. The Commission has removed fax service as an option for these filings and has added email service as a option for the filing of all subsequent documents.

One commenter proposes the Commission amend the service rule so that service on parties by fax or email is only effective if prior consent is given to be served in such ways. Another commenter suggests that email is acceptable as a method of service if there is agreement between the parties. Yet another commenter proposes that if email or fax are used, a hard copy should follow. First, part 580 applies to parties, not the Commission. Furthermore, fax and email service is available only after the initial notice of appeal and brief are filed personally or by registered or certified mail. If a party does not wish to serve subsequent documents via email or fax, it can utilize the other methods of service (personal service or first class mail). One benefit of email filing is that the filer can request a “read receipt” email from their email service and have proof that the email was received. The Commission declines to require that a hard copy follow, but parties are free to send follow-up hard copies if they wish, however the date of filing will be the date service was first accomplished.

The Commission proposes to refer to all parties who file appeals as “appellants.” Part 577 refers to those who file appeals of actions governed by that section “respondents”, while parts 524 and 539 do not assign a name to those who file appeals. The Commission believes it makes sense to refer to all appellants consistently and to use “appellant” rather than “respondent.” This proposed change has been made throughout the subchapter.

The Preliminary Draft provided that in computing any period of time prescribed for filing and serving a document, the first day of the period so computed shall not be included. The last day shall be included unless it is a Saturday, Sunday, or Federal legal holiday, in which case the period shall run until the end of the next business day. The Proposed rule adds that except for appeals of temporary closure orders, when the period of time prescribed allowed is less than 11 days, intermediate Saturdays, Sundays, and Federal legal holidays shall be excluded in the computation.

The Preliminary Draft included a section prohibiting ex parte communications. Several commenters questioned the reach and application of the prohibition, and expressed concern that it could stifle otherwise lawful communications. The Commission has not included the provision in this proposed rulemaking and invites comment on how to address ex parte communications.

One commenter suggested that the Commission should include a section on recusal. The Commission disagrees. Commission members must follow ethical rules applicable to all government employees as set forth in Federal law.See5 CFR 2635.501et seq.

Proposed § 580.5 provides that failure to file an appeal and brief within the time provided shall result in a waiver of the right to appeal and failure to meet any deadline for the filing of any motion or response thereto shall also result in a waiver of the right to file.

Proposed part 580 includes several additional sections designed to improve the appellate practice process. The Commission explains what is the burden of proof and standard of review, what a final decision will contain, the effective date of a decision, the finality of Commission decisions, what happens if the Commission does not issue a majority decision, and that an appeal of a Chair's decision does not stay the effect of that decision.

One commenter suggested that the filing of an appeal to the Commission should stay the effect of the Chair's decision. The Commission disagrees. The Commission believes that effective regulation of the industry will be fostered by requiring compliance with decisions of the Chair pending the resolution of an appeal to the Commission. Accordingly, the filing of a motion shall not stay the effect of any decision or order nor shall it affect thefinality of any decision or order for purposes of judicial review.

Section 580.10 provides that in the absence of a decision by a majority of the Commission within the time provided, the Chair's decision shall constitute the final decision of the Commission. The Preliminary Draft included the presiding official's recommended decision would also become final in the absence of a majority decision in the time provided. This was removed because the recommended decision is just that, a recommendation, and does not constitute a decision that would become final upon inaction.

Part 582 also explains what the final decision will contain, what the effective date of the decision will be, and that the decision is final for purposes of judicial review. It also sets forth the standard of review, which isde novo.

Part 581—Motions in Appeal Proceedings Before the Commission

Existing regulations do not set forth motion practice other than motions to intervene in appellate proceedings before a presiding official and motions for limited participation in ordinance appeals. Of course, during the course of an appeal appellants file typical appellate litigation motions and the Commission rules on those motions. Part 581 sets forth rules for this routine practice. This proposal is consistent with comments suggesting the Commission provide more rules governing appellate practice.

In the Preliminary Draft, motions to intervene were allowed in appeals before the presiding official, and motions for limited participation were allowed in appeals before the Commission on written submission. Proposed part 581 provides for the right to intervene in cases before the Commission on written submission as well as cases before the presiding official. Because intervention affords more process to litigants than limited participation, the Commission has removed limited participation from written submission appeals.

Proposed part 581, then, sets forth the procedure for filing a motion in an appeal on written submissions, a motion to supplement the record, and a motion for reconsideration. For requests for limited participation in ordinance appeals, motions to appeal before a presiding official and on written submissions before the Commission, and other motions before a presiding official, part 581 refers to the sections that govern those actions, where the process is set forth in detail: §§ 582.6, 584.6, and 584.5, and 585.5 respectively.

One commenter suggested that the Commission should clarify whether leave is required to file a motion to intervene. Motions to intervene are made only in appeals before a presiding official, governed by part 584, and proceedings on written submission before the Commission, governed by part 585. Part 584 does not require that leave be made to file a motion to intervene. The Commission believes the regulations are sufficiently clear in this regard.

One commenter noted that the terms “motion for reconsideration” and “petition for reconsideration” were used interchangeably throughout this part. The Commission has changed the language so that only “motion for reconsideration” is used.

The Commission believes that a full record enhances due process and effective decisionmaking. Consequently, in past matters the Commission has allowed the submission of additional evidence. No rules currently govern this area however. Thus, the Commission proposes that part 581 provide that parties may file motions to supplement the record at any time prior to a final Commission decision. The Commission may also supplement the record on its own motion.

One commenter proposed that the Commission should define the record and guarantee that parties have access to the record prior to filing an appeal. The Commission does not believe it necessary to include a definition of the record. The record is generally understood to include all documents relied on by the decisionmaker in arriving at the decision. The Commission believes that the current process of providing the record after an appeal has been filed conserves agency resources given that only a small number of decisions are appealed.

On occasion, the Commission has received and ruled upon motions for reconsideration of its decisions. Proposed part 581 sets forth rules for these motions. Under the proposed rule, motions for reconsideration may be made only in extraordinary circumstances, and a party may file only one such motion. The motion shall be filed within 30 days of the date of the final decision. Opposition briefs shall be filed within 10 days after the motion is filed. A reply brief must be filed within 5 days of service of the opposition brief. The Commission shall issue a decision within 30 days of the filing of the reply brief or the time to file a reply expires.

Part 582—Appeals of Disapprovals of Gaming Ordinances, Resolutions, or Amendments

The existing regulations governing appeals of disapprovals of gaming ordinances are set forth in part 524. The Commission proposes to repeal part 524, and replace it with part 582. Part 582 would be substantially similar to part 524, however some significant changes are proposed to improve the regulation. The existing rule does not provide a deadline by which one may request limited participation. Part 582 provides a deadline of 10 days after the filing of a notice of appeal. In addition, proposed part 582 requires the filing of a submission which shall state the entity's interest in the proceeding and why the Chair's decision should be upheld or reversed. In addition, part 582 provides that parties to the appeal may file briefs in opposition to the request for limited participation. New part 582 also requires the Commission rule on the request within 10 days of the last filing, or the expiration of the time to file.

Additionally, together, proposed §§ 582.3 and 582.6 provide that the record on which the Chair relied will be provided within 10 days of the filing of the notice of appeal, where practicable, and the appeal brief shall be filed within 15 days of service of the record.

Existing part 524 provides that the Commission will issue its decision within 90 days after receiving the appeal. Proposed part 582 provides that the Commission will issue its decision within 90 days of receiving the appeal brief, or within 90 days of its ruling on a request for limited participation. This affords the Commission sufficient time to allow full briefing of a request for limited participation while also allowing itself enough time to consider and rule on the merits of the matter.

One commenter noted that § 582.3 assumes that the Commission will always grant an appeal and asks whether the Commission could refuse to hear any appeal. No, the Commission may not refuse to hear an appeal. IGRA requires that the Commission provide an opportunity for an appeal and hearing for fines levied and for temporary closure orders.See25 U.S.C. 2713(a)(2) and (b)(2).

Part 583—Appeals From Approvals or Disapprovals of Management Contracts or Amendments to Management Contracts

Existing part 539 provides that a party may appeal the approval or disapproval of a management contract or amendment. The appeal shall be filedwithin 30 days after the Chair serves his or her determination. The appeal shall specify why the party believes the Chair's determination was erroneous, and the Commission shall issue a decision within 30 days unless the appellant elects to provide the Commission an additional 30 days. In the absence of a decision within the time provided, the Chair's decision shall constitute a final decision.

Proposed part 583 clarifies that only a party to the management contract or amendment may appeal pursuant to this part. It further requires a brief as well as a notice of appeal. The Commission amended the filing requirements of an appellant to demonstrate “why the appellant believes the Chair's approval or disapproval should be reversed.” This change was made because the word “erroneous” in the current rule could be interpreted to mean that the standard of proof is “erroneous”, a common standard of proof but not one that is applicable here.

Proposed §§ 583.3 and 583.6, together, provide that the record on which the Chair relied will be provided within 10 days of the filing of the notice of appeal, where practicable, and the appeal brief shall be filed within 15 days of service of the record. Proposed part 583 further provides that another party to the contract may oppose the appeal by filing an opposition brief within 20 days after service of the notice and brief. The appellant may file a reply brief within 10 days. The Commission will issue a final decision within 90 days after receipt of a notice of appeal and brief or within 90 days after the conclusion of briefing by the parties, whichever is later.

A commenter questioned why a party would wish to appeal an approval, and that appeals should be limited to disapprovals. The overwhelming majority of appeals in management contract cases are appeals of disapprovals. The Commission has, however, heard an appeal of an approval in a matter where two tribal factions were at odds. One faction argued that the other faction did not have authority to submit the management contract, and, based on that argument, appealed the approval of the contract.

Part 584—Appeals Before a Presiding Official of Notices of Violation, Proposed Civil Fine Assessments, Orders of Temporary Closure, the Chair's Decision To Void or Modify a Management Contracts, the Commission's Proposal To Remove a Certificate of Self-Regulation, and Notices of Late Fees and Late Fee Assessments

Existing part 577 governs appeals of enforcement actions and actions to void an approved management contract. Proposed part 584 provides that a party may appeal the issuance of a notice of violation, proposed civil fine assessment, order of temporary closure, decision to void or modify a management agreement, the Commission's removal of a certificate of self regulation, and late fee notifications and assessments.

Part 584 clarifies that appeals may be initiated by a tribe or the recipient of the action that is the subject of an appeal or in matters involving a management contract by a party to that contract.

The deadlines contained in proposed part 584 are substantially the same as in existing part 577. Appeals under part 584 must be brought within 30 days of the Chair or Commissions action or decision. The appeal must reference the action or decision that is being appealed. Part 584 provides that within 10 days after filing a notice of appeal the appellant must file a list of names of proposed witnesses, what they are expected to testify about, and whether a closed hearing is requested. Additionally, an appellant must submit a brief stating what relief they are seeking and why they think it should be granted. The brief may include supporting documentation including evidence in the form of affidavits.

Part 584 allows a party to waive the right to an oral hearing and instead elect to have the matter decided on the basis of written submissions. If a party elects to have the matter decided on written submissions, the proposed part 585 will govern the process by which the Commission reviews those appeals.

As with existing part 577, proposed part 584 allows an entity to intervene in the appeal if the presiding official finds that a final decision could directly or adversely affect it or the class it represents, it may contribute materially to the disposition of the proceedings, its interest is not adequately represented by existing parties, and the intervention would not prejudice the existing parties or delay the proceedings. As with existing part 577, proposed part 584 allows a tribe with jurisdiction over lands that are the subject of the appeal to intervene as a matter of right if they are not already a party. Proposed § 584.5(c) provides that such motions must be filed within 10 days of the notice of appeal. The Commission plans to quickly post appeals to its Web site to inform the public.

Part 584 allows the Chair to file a list of witnesses and their expected testimony and request that a hearing be closed. The Chair must make this request within 10 days after it has been served the appellants brief. Part 584 requires that a presiding official be named and a hearing take place within 30 days after the Commission receives a timely notice of appeal.

Part 584 requires that if the subject of the appeal is whether an order of temporary closure should be made permanent or be dissolved then a hearing must be concluded within 30 days or receiving a timely notice of appeal unless the appellant waives this right.

Proposed part 584 establishes procedures for requesting that information be treated as confidential. If the presiding official determines that confidential treatment is not warranted a party will be given the opportunity to withdraw a document before it is considered by the presiding official or disclose it voluntarily to all parties.

As with existing part 577, part 584 allows the parties to defer the hearing to negotiate a settlement or consent decree.

Part 584 requires the presiding official to issue a recommended decision within 30 days after the record has closed. The recommended decision will include findings of fact and conclusions of law and a recommended grant or denial of relief. Within 10 days after the recommended decision has issued the parties may file an objection to the recommended decision with the Commission.

Part 584 requires the Commission to issue a decision within 90 days after the recommended decision has been issued. In cases of temporary closure orders the Commission must issue its decision within 30 days.

Part 585—Appeals to the Commission on Written Submissions of Notices of Violation, Proposed Civil Fine Assessments, Orders of Temporary Closure, the Chair's Decision To Void or Modify a Management Contracts, the Commission's Proposal To Remove a Certificate of Self Regulation, and Notices of Late Fees and Late Fee Assessments

Existing part 577 combines procedures for both appeals where an oral hearing is requested and appeals where a decision on writtensubmissions has been requested. The proposed changes to the existing regulation separates oral hearing procedures from written submission decisions. Part 585 allows a tribe or the recipient to appeal an action based on written submissions instead of an oral hearing. The Commission believes that this option can benefit some parties because it can shorten the time period between when an action is taken and when a final decision is issued.

Part 585 allows an entity other than one of the parties to participate in the appeal on a limited basis. The proposed part 585 requirements for intervention mirror the current requirements contained in existing part 577.

Proposed §§ 585.3 and 585.6, together, provide that the record on which the Chair relied will be provided within 10 days of the filing of the notice of appeal, where practicable, and the appeal brief shall be filed within 15 days of service of the record. Regarding motions to intervene, proposed § 585.5(c) provides that such motions must be filed within 10 days of the notice of appeal. The Commission plans to quickly post appeals to its Web site to inform the public.

Proposed § 585.4 was expanded to permit motions other than those specifically set out at the discretion of the Commission. This mirrors language in part 584 regarding motions before a Presiding Official.

Existing part 577 allows the parties to suspend a hearing so that a settlement or consent decree may be negotiated. Since proposed part 585 segregates appeals based on written submissions from oral hearings such procedures are not necessary.

Part 585 requires the Commission to issues its decision within 90 days of receiving a notice of appeal and appeal brief. For appeals of temporary closure orders, the Commission must issue its decision within 60 days.

A commenter expressed concern about Commission and staff turnover and the impact of such turnover on how appeals are handled and decided. This commenter argued that turnover leads to inconsistent outcomes. First, the terms of Commissioners are for a substantial period of time. Under the Act, the Chairman and one of the Commissioners have terms of 3 years. The other Commissioner has a term of one year. However, Commissioners can serve after the expiration of their term until his or her successor has been appointed. That being said, changes in personnel, whether Commissioners after their term or Commission staff, are inevitable in any decision-making forum. The fact that Commission members and staff change, however, should not lead to inconsistent results. Commission decisions establish precedent that the Commission must either follow or must provide a reasonable basis for its departure from.

Regulatory MattersRegulatory Flexibility Act

This proposed rule will not have a significant economic effect on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601et seq.Indian tribes are not considered to be small entities for the purposes of the Regulatory Flexibility Act.

Small Business Regulatory Enforcement Fairness Act

This proposed rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule does not have an annual effect on the economy of $100 million or more. This rule will not cause a major increase in costs or prices for consumers, individual industries, Federal, state or local government agencies or geographic regions and does not have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of U.S. based enterprises to compete with foreign-based enterprises.

Unfunded Mandate Reform Act

The Commission, as an independent regulatory agency within the Department of the Interior, is exempt from compliance with the Unfunded Mandates Reform Act. 2 U.S.C. 1502(1); 2 U.S.C. 658(1).

Takings

In accordance with Executive Order 12630, the Commission has determined that this proposed rule does not have significant takings implications. A takings implication assessment is not required.

Civil Justice Reform

In accordance with Executive Order 12988, the Office of General Counsel has determined that the proposed rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Executive Order.

National Environmental Policy Act

The Commission has determined that this proposed rule does not constitute a major Federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4321et seq.

Paperwork Reduction Act

This proposed rule does not require information collection under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501,et seq.,and is therefore not subject to review by the Office of Management and Budget.

For the reasons stated in the preamble, and under the authority of the Indian Gaming Regulatory Act, 25 U.S.C. 2701-2712, the National Indian Gaming Commission proposes to amend 25 CFR chapter III by removing 25 CFR parts 524, 539, and 577, and adding subchapter H, consisting of parts 580 through 585, as follows:

Subchapter H—Appeal Proceedings before the CommissionPART 580—RULES OF GENERAL APPLICATION IN APPEAL PROCEEDINGS BEFORE THE COMMISSIONPART 581—MOTIONS IN APPEAL PROCEEDINGS BEFORE THE COMMISSIONPART 582—APPEALS OF DISAPPROVALS OF GAMING ORDINANCES, RESOLUTIONS, OR AMENDMENTSPART 583—APPEALS FROM APPROVALS OR DISAPPROVALS OF MANAGEMENT CONTRACTS OR AMENDMENTS TO MANAGEMENT CONTRACTSPART 584—APPEALS BEFORE A PRESIDING OFFICIAL OF NOTICES OF VIOLATION, PROPOSED CIVIL FINE ASSESSMENTS, ORDERS OF TEMPORARY CLOSURE, THE CHAIR'S DECISION TO VOID OR MODIFY A MANAGEMENT CONTRACTS, THE COMMISSION'S PROPOSAL TO REMOVE A CERTIFICATE OF SELF-REGULATION, AND NOTICES OF LATE FEES AND LATE FEE ASSESSMENTSPART 585—APPEALS TO THE COMMISSION ON WRITTEN SUBMISSIONS OF NOTICES OF VIOLATION, PROPOSED CIVIL FINE ASSESSMENTS, ORDERS OFTEMPORARY CLOSURE, THE CHAIR'S DECISION TO VOID OR MODIFY A MANAGEMENT CONTRACTS, THE COMMISSION'S PROPOSAL TO REMOVE A CERTIFICATE OF SELF-REGULATION, AND NOTICES OF LATE FEES AND LATE FEE ASSESSMENTSPART 580—RULES OF GENERAL APPLICATION IN APPEAL PROCEEDINGS BEFORE THE COMMISSIONSec.580.1What definitions apply?580.2When may the Commission suspend, revoke, amend, or waive its rules governing proceedings before the Commission?580.3Who may appear before the Commission?580.4How do I effect service?580.5What happens if I file late or fail to file?580.6What is the burden of proof and standard of review?580.7What will the Commission's final decision contain?580.8What is the effective date of the Commission's final decision?580.9Is the Commission's decision final agency action?580.10What if the Commission does not issue a majority decision?580.11Does an appeal of a Chair's decision stay the effect of that decision?Authority:

25 U.S.C. 2706, 2713, 2715.

§ 580.1What definitions apply?

Day:A calendar day.

De novo review:A standard of review where the Commission reviews the matter anew, as if it had not been reviewed by the Chair.

Limited participant:A party who successfully petitions the Commission to participate on a limited basis in either an ordinance appeal under § 582.5, or an appeal on written submissions under § 585.5.

Preponderance of the evidence:The degree of relevant evidence that a reasonable person, considering the record as a whole, would accept as sufficient to find that a contested fact is more likely to be true than untrue.

Presiding official:The individual who presides over the hearing and issues the recommended decision under part 584.

Proceeding:All or part of an appeal heard by a presiding official or the Commission, and decided by the Commission.

Summary proceeding:A proceeding in which the appeal is on paper only, with no hearing.

§ 580.2When may the Commission suspend, revoke, amend, or waive its rules governing proceedings before the Commission?

The procedural provisions of subchapter H of this chapter may be suspended, revoked, amended, or waived for good cause shown, in whole or in part, on motion to the Commission, or on its own motion, if the interest of justice so requires, except that the Commission may not extend the time for filing a notice of appeal.

§ 580.3Who may appear before the Commission?

In any appeal proceeding under parts 582 through 585 of this subchapter, a party or limited participant may appear in person or by an attorney or other authorized representative. An attorney must be in good standing and admitted to practice before any Court of the United States, the District of Columbia, any tribal court, or the highest court of any state, territory, or possession of the United States. Any person appearing as an attorney or authorized representative shall file with the Commission a written notice of appearance. The notice must state his or her name, address, telephone number, facsimile number and email address, if any; and the name and address of the person or entity on whose behalf he or she appears.

§ 580.4How do I effect service?

(a) An appellant shall serve its notice of appeal on the Commission at the address indicated in the decision or notice that is the subject of the appeal.

(b) Copies of the notice of appeal shall be filed personally or by registered or certified mail, return receipt requested. All subsequent documents shall be served personally, by facsimile, by email to an address designated by a Commission employee, or by first class mail. In matters where a hearing has been requested, all filings shall be made with the Commission until a presiding official is designated and the parties are so notified, after which all filings shall be made with the presiding official.

(c) All documents filed after the notice of appeal shall be served on the Commission and copies simultaneously served on all parties, intervenors or limited participants.

(d) Service of copies of all documents is complete at the time of personal service or, if service is made by mail, facsimile, or email, upon transmittal.

(e) When a representative (including an attorney) has entered an appearance for a party, limited participant or intervenor in a proceeding initiated under any provision of parts 581 through 585 of this subchapter, service thereafter shall be made upon the representative.

(f) In computing any period of time prescribed for filing and serving a document, the first day of the period so computed shall not be included. The last day shall be included unless it is a Saturday, Sunday, or Federal legal holiday, in which case the period shall run until the end of the next business day. Except for appeals of temporary closure orders, when the period of time prescribed or allowed is less than 11 days, intermediate Saturdays, Sundays, and Federal legal holidays shall be excluded in the computation.

(g) The Commission may extend the time for filing or serving any document except a notice of appeal.

(1) A request for an extension of time must be filed within the time originally allowed for filing.

(2) For good cause, the Commission may grant an extension of time on its own motion.

(h) Rules governing service of documents by the Chair or Commission are governed by part 519 of this chapter.

§ 580.5What happens if I file late or fail to file?

(a) Failure to file an appeal within the time provided shall result in a waiver of the right to appeal.

(b) Failure to meet any deadline for the filing of any motion or response thereto shall result in a waiver of the right to file.

§ 580.6What is the burden of proof and standard of review?

(a) The Chair bears the burden of proof to support his or her action or decision by a preponderance of the evidence.

The Commission may affirm, modify, or reverse, in whole or in part, the Chair's decision or presiding official's recommended decision, or may remove a certificate of self-regulation, and will state the bases of its decision. The final decision will be in writing and will include:

(a) A statement of findings and conclusions, with the bases for them on all material issues of fact, law, or discretion;

(b) A ruling on each material issue; and

(c) An appropriate grant or denial of relief.

§ 580.8What is the effective date of the Commission's final decision?

The Commission's final decision is effective immediately unless the Commission provides otherwise in the decision.

§ 580.9Is the Commission's decision final agency action?

The Commission's final decision is a final agency action for purposes of judicial review.

§ 580.10What if the Commission does not issue a majority decision?

In the absence of a decision of a majority of the Commission within the time provided, the Chair's decision shall constitute the final decision of the Commission except that, if the subject of the appeal is a temporary closure order, the order shall be dissolved.

§ 580.11Does an appeal of a Chair's decision stay the effect of that decision?

An appeal does not stay the effect of a Chair's decision. The appellant must comply with the Chair's decision pending the outcome of the appeal.

PART 581—MOTIONS IN APPEAL PROCEEDINGS BEFORE THE COMMISSIONSec.581.1What is the scope of this part?581.2How does an entity other than a tribe request to participate on a limited basis in an ordinance appeals?581.3How do I file a motion to intervene in appeals?581.4How do I file a motion before a presiding official?581.5How do I file a motion to supplement the record?581.6How do I file a motion for reconsideration?Authority:

25 U.S.C. 2706, 2713, 2715.

§ 581.1What is the scope of this part?

(a) This part governs motion practice under:

(1) Part 582 of this chapter, appeals of disapprovals of gaming ordinances, resolutions, or amendments;

(2) Part 583 of this chapter, appeals of the approval or disapproval of management contracts or amendments to a management contract;

(3) Part 584 of this chapter, appeals before a presiding official of notices of violation, orders of temporary closure, proposed civil fine assessments, the Chair's decision to void or modify a management contracts, the Commission's proposal to remove a certificate of self-regulation, and notices of late fees and late fee assessments; and

(4) Part 585 of this chapter, appeals to the Commission on written submissions of, notices of violation, orders of temporary closure, proposed civil fine assessments, the Chair's decision to void or modify a management contracts, the Commission's proposal to remove a certificate of self-regulation, and notices of late fees and late fee assessments.

(b) This part also governs motion practice in hearings under § 535.3 of this chapter to review the Chair's decision to void or modify a management contract.

§ 581.2How does an entity other than a tribe request to participate on a limited basis in an ordinance appeals?

Requests for limited participation in ordinance appeals are governed by § 582.5.

§ 581.3How do I file a motion to intervene in appeals?

Motions to intervene in appeals before a presiding official are governed by § 584.5.

Motions to intervene in appeals before the Commission are governed by § 585.5.

§ 581.4How do I file a motion before a presiding official?

Motion practice before a presiding official on appeals of notices of violation, orders of temporary closure, proposed civil fine assessments, the Chair's decision to void or modify a management contracts, and notices of late fees and late fee assessments is governed by § 584.4.

§ 581.5How do I file a motion to supplement the record?

Upon its own motion or the motion of a party, the Commission may allow the submission of additional evidence. A party may file a motion for leave to submit additional evidence at any time prior to issuance of a final decision by the Commission. Such motion shall show with particularity that such additional evidence is material and that there were reasonable grounds for failure to submit such evidence previously. The Commission may adjust its time for issuing a final decision accordingly, unless the subject of the appeal is a temporary closure order.

§ 581.6How do I file a motion for reconsideration?

(a) Motions for reconsideration may be made only for final decisions on appeal and only in extraordinary circumstances.

(b) A motion for reconsideration and accompanying brief shall be filed within 30 days of the date of the Commission's final decision and shall be served on all parties, limited participants, and intervenors, if any. A motion for reconsideration shall explain the extraordinary circumstances requiring reconsideration.

(c) A party may file only one motion and accompanying brief for reconsideration.

(d) Opposition briefs shall be filed within 10 days after the motion is filed.

(e) A reply brief to the brief in opposition shall be filed within 5 days of service of the brief in opposition.

(f) The Commission shall issue a decision on reconsideration within 30 days of the filing of the reply brief or the time to file a reply brief expires, whichever is later. The Commission shall issue a brief statement of the reasons for its decision.

(g) If the Commission grants the motion, it may reverse or modify the decision, in whole or in part, from which reconsideration is sought or may remand to the Chair for further consideration.

(h) The filing of a motion will not stay the effect of any decision or order and will not affect the finality of any decision or order for purposes of judicial review, unless so ordered by the Commission.

PART 582—APPEALS OF DISAPPROVALS OF GAMING ORDINANCES, RESOLUTIONS, OR AMENDMENTSSec.582.1What does this part cover?582.2Who may appeal the disapproval of a gaming ordinance?582.3How do I appeal the disapproval of a gaming ordinance?582.4Are motions permitted?582.5How does an entity other than a tribe request to participate on a limited basis?582.6When will I receive a copy of the record on which the Chair relied?582.7When will the Commission issue its final decision?Authority:

25 U.S.C. 2706, 2710, 2713, 2715.

§ 582.1What does this part cover?

This part applies to appeals from the Chair's decision to disapprove a gaming ordinance, resolution, or amendment under part 522 of this chapter.

§ 582.2Who may appeal the disapproval of a gaming ordinance?

Only the tribe whose gaming ordinance, resolution, or amendment is disapproved by the Chair may appeal.

§ 582.3How do I appeal the disapproval of a gaming ordinance?

Within 30 days after the Chair serves his or her disapproval, the appellant must file with the Commission a notice of appeal. The notice of appeal must reference the decision from which the appeal is taken. Unless the Commission has extended the time for filing an appeal brief pursuant to § 580.4(g), the appeal brief must be filed within 15 days of service of the record pursuant to § 582.6. The appeal brief shall state succinctly why the appellant believes the Chair's disapproval should bereversed and may include supporting documentation.

§ 582.4Are motions permitted?

Ordinance appeals are summary proceedings. Only motions for extension of time, motions for limited participation, motions to supplement the record under § 581.5, and motions for reconsideration under § 581.6 are permitted.

§ 582.5How does an entity other than a tribe request to participate on a limited basis?

(a) An entity other than the tribe identified in § 582.2 may request to participate in an appeal of an ordinance disapproval on a limited basis by filing a submission with the Commission within 10 days of the filing of the notice of appeal.

(b) The submission may contain supporting documentation, and shall state:

(1) The entity's property, financial, or other interest at stake in the proceeding; and

(2) Why the Chair's decision should be upheld or reversed. The submission shall address the ordinance requirements under §§ 522.4, 522.5, 522.6, and 522.7 of this chapter.

(c) The submission shall simultaneously be served on the tribe consistent with § 580.4. Failure to properly serve the tribe may be a basis for denying limited participation.

(d) Within 10 days after service of the submission, any party to the appeal may file a brief and supporting material in response to the submission.

(e) Within 10 days of the filing of a response pursuant to paragraph (d) of this section, the Commission will notify the submitter in writing of its decision whether to accept and consider the submission and will state the basis for its decision, which it shall serve on the submitter and the tribe.

§ 582.6When will I receive a copy of the record on which the Chair relied?

Within 10 days of the filing of a notice of appeal, or as soon thereafter as practicable, the record on which the Chair relied will be transmitted to the tribe.

§ 582.7When will the Commission issue its final decision?

(a) Within 90 days after it receives the appeal brief or within 90 days of its ruling on a request for limited participation brought under § 582.5, whichever is later, the Commission shall issue its final decision.

(b) The Commission shall notify the tribe and any limited participant of its final decision and the reasons supporting it.

PART 583—APPEALS FROM APPROVALS OR DISAPPROVALS OF MANAGEMENT CONTRACTS OR AMENDMENTS TO MANAGEMENT CONTRACTSSec.583.1What does this part cover?583.2Who may appeal the approval or disapproval of a management contract or amendment to a management contract?583.3How do I appeal the approval or disapproval of a management contract or amendment to a management contract?583.4Are motions permitted?583.5When will I receive a copy of the record on which the Chair relied?583.6When will the Commission issue its final decision?Authority:

25 U.S.C. 2706, 2711, 2712, 2713, 2715.

§ 583.1What does this part cover?

This part applies to appeals from the Chair's decision to approve or disapprove a management contract or amendment to a management contract under parts 533 and 535 of this chapter.

§ 583.2Who may appeal the approval or disapproval of a management contract or amendment to a management contract?

Only a party to the management contract or amendment approved or disapproved by the Chair may appeal.

§ 583.3How do I appeal the approval or disapproval of a management contract or amendment to a management contract?

(a) Within 30 days after the Chair serves his or her determination, the appellant must file with the Commission, and serve on all parties to the management contract, a notice of appeal. The notice of appeal must reference the decision from which the appeal is taken. Unless the Commission has extended the time for filing an appeal brief pursuant to § 580.4(g), the appeal brief must be filed within 15 days of service of the record pursuant to § 583.5. The brief shall state succinctly why the appellant believes the Chair's approval or disapproval should be reversed and may include supporting documentation.

(b) Another party to the management contract may oppose the appeal by:

(1) Filing an opposition brief with the Commission within 20 days after service of the appellant's brief. The opposition brief shall state succinctly why the party believes the Chair's approval or disapproval should be upheld and may include supporting documentation.

(c) The appellant may file a reply brief within 10 days.

§ 583.4Are motions permitted?

Management contract and amendment appeals are summary proceedings. Only motions for extension of time under § 580.4(g), motions to supplement the record under § 581.6, and motions for reconsideration under § 581.7 are permitted.

§ 583.5When will I receive a copy of the record on which the Chair relied?

Within 10 days of the filing of a notice of appeal, or as soon thereafter as practicable, the record on which the Chari relied will be transmitted to all parties.

§ 583.6When will the Commission issue its final decision?

(a) The Commission shall issue its final decision within 90 days after service of the appeal brief, or within 90 days after the conclusion of briefing by the parties, whichever is later.

(b) The Commission shall notify the tribe and management contractor of its final decision and the reasons supporting it.

PART 584—APPEALS BEFORE A PRESIDING OFFICIAL OF NOTICES OF VIOLATION, PROPOSED CIVIL FINE ASSESSMENTS, ORDERS OF TEMPORARY CLOSURE, THE CHAIR'S DECISION TO VOID OR MODIFY A MANAGEMENT CONTRACTS, THE COMMISSION'S PROPOSAL TO REMOVE A CERTIFICATE OF SELF-REGULATION, AND NOTICES OF LATE FEES AND LATE FEE ASSESSMENTSSec.584.1What does this part cover?584.2Who may appeal?584.3How do I appeal a notice of violation, proposed civil fine assessment, order of temporary closure, the Chair's decision to void or modify a management contract, the Commission's proposal to remove a certificate of self-regulation, and notices of late fees and late fee assessments?584.4Are motions permitted?584.5How do I file a motion to intervene?584.6When will the hearing be held?584.7When will I receive a copy of the record on which the Chair relied?584.8What is the hearing process?584.9How may I request to limit disclosure of confidential information?584.10What is the process for pursuing settlement or a consent decree?584.11Will the hearing be transcribed?584.12What happens after the hearing?584.13May I file an objection to the recommended decision?584.14When will the Commission issue its final decision?Authority:

25 U.S.C. 2706, 2710, 2711, 2712, 2713, 2715, 2717.

§ 584.1What does this part cover?

(a) This part applies to appeals of the following where the appellant elects a hearing before a presiding official:

(1) A violation alleged in a notice of violation under § 573.3;

(2) Proposed civil fine assessments under part 575 of this chapter;

(3) Orders of temporary closure under § 573.6;

(4) The Chair's decision to void or modify a management contract under part 535 of this chapter subsequent to initial approval;

(5) The Commission's proposal to remove a certificate of self regulation under part 515 of this chapter; and

(6) Late fee notifications and assessments under part 514 of this chapter.

(b) Appeals identified in paragraph (a) of this section brought directly before the Commission on the written record and without a hearing are filed pursuant to part 585 of this chapter.

§ 584.2Who may appeal?

(a) Appeals of notices of violation, proposed civil fine assessments, orders of temporary closure, proposals to remove a certificate of self-regulation and late fee notifications and assessments may only be brought by the tribe or the recipient of the action that is the subject of the appeal.

(b) Appeals of the Chair's decision to void or modify a management contract after approval may only be brought by a party to the management contract.

§ 584.3How do I appeal a notice of violation, proposed civil fine assessment, order of temporary closure, the Chair's decision to void or modify a management contract, the Commission's proposal to remove a certificate of self-regulation, and notices of late fees and late fee assessments?

(a) Within 30 days after the Chair serves his or her action or decision, or the Commission serves its intent to remove a certificate of self-regulation, the appellant must file a notice of appeal with the Commission. The notice of appeal must reference the action or decision from which the appeal is taken.

(b) Within 10 days after filing the notice of appeal, the appellant shall file with the Commission:

(1) A list of the names of proposed witnesses who would present oral testimony at the hearing, the general nature of their expected testimony, and whether a closed hearing is requested and why;

(2) A brief that states succinctly the relief desired and the grounds in support thereof; and which may include supporting documentation and evidence in the form of affidavits.

(c) A party that has filed a notice of appeal may waive the right to an oral hearing before a presiding official and instead elect to have the matter determined by the Commission solely on the basis of written submissions. Appeals based on written submissions are governed by part 585 of this subchapter. If there is more than one party that has filed a notice of appeal, and any party that has filed a notice of appeal elects a hearing before a presiding official, the entire matter will proceed before a presiding official.

(d) The Chair may file a response brief and a list of the names of proposed witnesses who will present oral testimony at the hearing, the general nature of their expected testimony, and whether a closed hearing is requested and why within 10 days after service of the appellate brief.

§ 584.4Are motions permitted?

Yes. Motions to intervene under § 584.5 are permitted. Motions for an extension of time that are filed before the appointment of a presiding official shall be decided by the Commission. All other motions may be scheduled and heard at the discretion of the presiding official.

§ 584.5How do I file a motion to intervene?

(a) An entity not permitted to appeal may be permitted to participate as a party if the presiding official finds that:

(1) The final decision could directly and adversely affect it or the class it represents;

(2) It may contribute materially to the disposition of the proceedings;

(3) Its interest is not adequately represented by existing parties; and

(4) Intervention would not unfairly prejudice existing parties or delay resolution of the proceeding.

(b) A tribe with jurisdiction over the lands on which there is a gaming operation that is the subject of a proceeding under this part may intervene as a matter of right if the tribe is not already a party.

(c) A motion to intervene shall be submitted to the presiding official within 10 days of the notice of appeal. The motion shall be filed with the presiding official and served on each person who has been made a party at the time of filing. The motion shall state succinctly:

(1) The moving party's interest in the proceeding;

(2) How his or her participation as a party will contribute materially to the disposition of the proceeding;

(3) Who will appear for the moving party;

(4) The issues on which the moving party wishes to participate; and

(5) Whether the moving party wishes to present witnesses.

(d) Objections to the motion must be filed by any party within ten days after service of the motion.

(e) A reply brief to the brief in opposition may be filed within 5 days of service of the brief in opposition.

(f) When motions to intervene are made by individuals or groups with common interests, the presiding official may request all such movants to designate a single representative, or he or she may recognize one or more movants.

(g) The presiding official shall give each movant and party written notice of his or her decision on the motion. For each motion granted, the presiding official shall provide a brief statement of the basis for the decision. If the motion is denied, the presiding official shall briefly state the grounds for denial. The presiding official may allow the movant to participate as amicus curiae, if appropriate.

§ 584.6When will the hearing be held?

(a) The Commission shall designate a presiding official who shall commence a hearing within 30 days after the Commission receives a timely notice of appeal. At the request of the appellant, the presiding official may waive the 30 day hearing requirement upon designation.

(b) If the subject of an appeal is whether an order of temporary closure should be made permanent or be dissolved, the hearing shall be concluded within 30 days after the Commission receives a timely notice of appeal, unless the appellant waives this right. Notwithstanding any other provision of this part, the presiding official shall conduct such a hearing in a manner that will enable him or her to conclude the hearing, including any period the record is kept open following the hearing, within the period required by this paragraph consistent with any due process rights of the parties.

§ 584.7When will I receive a copy of the record on which the Chair relied?

Upon designation by the presiding official, the Commission shall transmit the agency record on which the Chair relied to the presiding official and the parties.

§ 584.8What is the hearing process?

(a) Once designated by the Commission, the presiding official shall set the matter for hearing. The appellant may appear at the hearing personally, through counsel, or by an authorizedrepresentative consistent with the requirements of § 580.3 of this subchapter. The appellant, the Chair, and any intervenor shall have the right to introduce relevant written materials and to present an oral argument. At the discretion of the presiding official, a hearing under this section may include an opportunity to submit oral and documentary evidence and cross-examine witnesses.

(b) When holding a hearing under this part, the presiding official shall:

(1) Administer oaths and affirmations;

(2) Issue subpoenas authorized by the Commission;

(3) Rule on offers of proof and receive relevant evidence;

(4) Authorize exchanges of information (including depositions and interrogatories in accordance with 25 CFR part 571, subpart C) among the parties when to do so would expedite the proceeding;

(5) Establish and administer the course of the hearing;

(6) When appropriate, hold conferences for the settlement or simplification of the issues by consent of the parties;

(7) At any conference held pursuant to paragraph (b)(6) of this section, require the attendance of at least one representative of each party who has authority to negotiate the resolution of issues in controversy;

(8) Dispose of procedural requests or similar matters;

(9) Recommend decisions in accordance with § 584.12; and

(10) Take other actions authorized by the Commission consistent with this part.

(c) The presiding official may order the record to be kept open for a reasonable period following the hearing (normally ten days), during which time the parties may make additional submissions to the record. Thereafter, the record shall be closed and the hearing shall be deemed concluded. Within 30 days after the record closes, the presiding official shall issue a recommended decision in accordance with § 584.12.

§ 584.9How may I request to limit disclosure of confidential information?

(a) If any person submitting a document in a proceeding claims that some or all of the information contained in that document is:

(1) Exempt from the mandatory public disclosure requirements under the Freedom of Information Act (5 U.S.C. 552);

(2) Information referred to in 18 U.S.C. 1905 (disclosure of confidential information); or

(3) Otherwise exempt by law from public disclosure, the person shall:

(i) Indicate that the document in its entirety is exempt from disclosure or identify and segregate information within the document that is exempt from disclosure; and

(ii) Request that the presiding official not disclose such information to the parties to the proceeding (other than the Chair, whose actions regarding the disclosure of confidential information are governed by § 571.3) except pursuant to paragraph (b) of this section, and shall serve the request upon the parties to the proceeding. The request to the presiding official shall include:

(A) A copy of the document, group of documents, or segregable portions of the documents marked “Confidential Treatment Requested”; and

(B) A statement explaining why the information is confidential.

(b) If the presiding official determines that confidential treatment is not warranted with respect to all or any part of the information in question, the presiding official shall so inform all parties. The person requesting confidential treatment then shall be given an opportunity to withdraw the document before it is considered by the presiding official or to disclose the information voluntarily to all parties.

(c) If the presiding official determines that confidential treatment is warranted, the presiding official shall so inform all parties.

(d) If the presiding official determines that confidential treatment is warranted, a party to a proceeding may request that the presiding official direct the person submitting the confidential information to provide that information to the party. The presiding official may so direct if the party requesting the information agrees under oath and in writing:

(1) Not to use or disclose the information except directly in connection with the hearing; and

(2) To return all copies of the information at the conclusion of the proceeding to the person submitting the information under paragraph (a) of this section.

(e) If a person submitting documents in a proceeding under this part does not claim confidentiality under paragraph (a) of this section, the presiding official may assume that there is no objection to disclosure of the document in its entirety.

(f) When a decision by a presiding official is based in whole or in part on evidence not included in the record, the decision shall so state, specifying the nature of the evidence and the provision of law under which disclosure was denied, and the evidence so considered shall be retained under seal as part of the official record.

§ 584.10What is the process for pursuing settlement or a consent decree?

(a)General.At any time after the commencement of a proceeding, but at least five days before the date set for hearing under § 584.6, the parties jointly may move to defer the hearing for a reasonable time to permit negotiation of a settlement or an agreement containing findings and an order disposing of the whole or any part of the proceeding.

(b)Content.Any agreement containing consent findings and an order disposing of the whole or any part of a proceeding shall also provide:

(1) A waiver of any further procedural steps before the Commission;

(2) A waiver of any right to challenge or contest the validity of the order and decision entered into in accordance with the agreement; and

(3) The presiding official's certification of the findings and agreement shall constitute dismissal of the appeal and final agency action.

(c)Submission.Before the expiration of the time granted for negotiations, the parties or their authorized representatives may:

(1) Submit to the presiding official a proposed agreement containing consent findings and an order;

(2) Notify the presiding official that the parties have reached a full settlement or partial settlement and have agreed to dismissal of the action or part thereof, subject to compliance with the terms of the settlement; or

(3) Inform the presiding official that agreement cannot be reached.

(d)Disposition.In the event a full or partial settlement agreement containing consent findings and an order is submitted within the time granted, the presiding official shall certify such findings and agreement within 30 days after his or her receipt of the submission. Such certification shall constitute full or partial dismissal of the appeal, as applicable, and final agency action.

§ 584.11Will the hearing be transcribed?

Yes. Hearings under this part that involve oral presentations shall be recorded verbatim and transcripts thereof shall be provided to parties upon request. Each party shall pay its own fees for transcripts.

§ 584.12What happens after the hearing?

(a) Within 30 days after the record closes, the presiding official shall issue his or her recommended decision.

(b) The recommended decision shall be in writing, based on the whole record, and include:

(1) Recommended findings of fact and conclusions of law upon each material issue of fact or law; and

(2) A recommended grant or denial of relief.

(c) The presiding official's recommended decision is reviewed by the Commission. The Commission issues the final decision.

§ 584.13May I file an objection to the recommended decision?

Yes. Within 10 days after service of the presiding official's recommended decision, any party may file with the Commission objections to any aspect of the decision, and the reasons therefore.

§ 584.14When will the Commission issue its decision?

(a) The Commission shall issue its decision within 90 days after the date of the recommended decision, unless the recommended decision is to dissolve or make permanent a temporary closure order issued under § 573.6 of this chapter, in which case the Commission shall issue its decision within 30 days.

(b) The Commission shall serve the final decision upon the parties.

PART 585—APPEALS TO THE COMMISSION ON WRITTEN SUBMISSIONS OF NOTICES OF VIOLATION, PROPOSED CIVIL FINE ASSESSMENTS, ORDERS OF TEMPORARY CLOSURE, THE CHAIR'S DECISION TO VOID OR MODIFY A MANAGEMENT CONTRACTS, THE COMMISSION'S PROPOSAL TO REMOVE A CERTIFICATE OF SELF REGULATION, AND NOTICES OF LATE FEES AND LATE FEE ASSESSMENTSSec.585.1What does this part cover?585.2Who may appeal?585.3How do I appeal a notice of violation, proposed civil fine assessment, order of temporary closure, the Chair's decision to void or modify a management contract, the Commission's proposal to remove a certificate of self regulation, and notices of late fees and late fee assessments?585.4Are motions permitted?585.5How do I file a motion to intervene?585.6When will I receive a copy of the record on which the Chair relied?585.7When will the Commission issue its decision?Authority:

25 U.S.C. 2706, 2710, 2711, 2712, 2713, 2715, 2717.

§ 585.1What does this part cover?

(a) This part applies to appeals of the following where the appellant does not elect a hearing before a presiding official and instead elects to have the matter decided by the Commission solely on the basis of written submissions:

(1) A violation alleged in a notice of violation under § 573.3;

(2) Proposed civil fine assessments under part 575 of this chapter;

(3) Orders of temporary closure under § 573.6;

(4) The Chair's decision to void or modify a management contract under part 535 of this chapter subsequent to initial approval;

(5) The Commission's proposal to remove a certificate of self-regulation under part 585 of this chapter; and

(6) Late fee notifications and assessments under part 514 of this chapter.

(b) Appeals from these actions involving a hearing before a presiding official are brought under part 584 of this chapter.

§ 585.2Who may appeal?

(a) Appeals of notices of violation, proposed civil fine assessments, orders of temporary closure, proposals to remove certificates of self-regulation, and late fee notifications and assessments may only be brought by the tribe or the recipient that is the subject of the action.

(b) Appeals of the Chair's decision to void or modify a management contract after approval may only be brought by a party to the management contract.

§ 585.3How do I appeal a notice of violation, proposed civil fine assessment, order of temporary closure, the Chair's decision to void or modify a management contract, the Commission's proposal to remove a certificate of self regulation, and notices of late fees and late fee assessments?

(a) Within 30 days after the Chair serves his or her action or decision, or the Commission serves notice of its intent to remove a certificate of self-regulation, appellant must file a notice of appeal with the Commission. The notice of appeal must reference the action or decision from which the appeal is taken and shall include a written waiver of the right to an oral hearing before and an election to have the matter determined by the Commission solely on the basis of written submissions. Unless the Commission has extended the time for filing an appeal brief pursuant to § 580.4(g), the appeal brief must be filed within 15 days of service of the record pursuant to § 585.7. The appeal brief shall state succinctly the relief desired and the supporting grounds thereof and may include supporting documentation.

(b) Hearings before a presiding official are governed by part 584.

§ 585.4Are motions permitted?

(a) Motions for extension of time, motions to supplement the record under § 581.6, motions to intervene under § 585.5, and motions for reconsideration under § 581.7 are permitted. All other motions may be considered at the discretion of the Commission.

(b) The Chair shall not, either individually or through counsel, file or respond to motions.

§ 585.5How do I file a motion to intervene?

(a) An entity not permitted to appeal may be permitted to participate as a party to a pending appeal if the Commission finds that:

(1) The final decision could directly and adversely affect it or the class it represents;

(2) It may contribute materially to the disposition of the proceedings;

(3) Its interest is not adequately represented by existing parties; and

(4) Intervention would not unfairly prejudice existing parties or delay resolution of the proceeding.

(b) A tribe with jurisdiction over the lands on which there is a gaming operation that is the subject of a proceeding under this part may intervene as a matter of right if the tribe is not already a party.

(c) A motion to intervene shall be submitted to the Commission within ten days of the notice of appeal. The motion shall be filed with the Commission and served on each person who has been made a party at the time of filing. The motion shall state succinctly:

(1) The moving party's interest in the proceeding;

(2) How his or her participation as a party will contribute materially to the disposition of the proceeding;

(3) Who will appear for the moving party;

(4) The issues on which the moving party wishes to participate; and

(5) Whether the moving party wishes to present witnesses.

(d) Objections to the motion must be filed by any party within ten days after service of the motion.

(e) A reply brief to the brief in opposition may be filed within 5 days of service of the brief in opposition.

(f) When motions to intervene are made by individuals or groups with common interests, the Commission may request all such movants to designate a single representative, or the Commission may recognize one or more movants.

(g) The Commission shall give each movant and party written notice of the decision on the motion. For each motion granted, the Commission shall provide abrief statement of the basis for the decision. If the motion is denied, the Commission shall briefly state the grounds for denial. The Commission may allow the movant to participate as amicus curiae, if appropriate.

§ 585.6When will I receive a copy of the record on which the Chair relied?

Within 10 days of the filing of an appeal brief, or as soon thereafter as practicable, the record on which the Chair relied will be transmitted to the appellant.

§ 585.7When will the Commission issue its decision?

(a) The Commission shall issue its decision within 90 days after it receives the appeal brief, or its ruling on a request for intervention, if applicable, unless the subject of the appeal is whether to dissolve or make permanent a temporary closure order issued under § 573.6 chapter, in which case the Commission shall issue its decision within 60 days.

(b) The Commission shall serve the final decision upon the appellants, and any limited participant.

The National Indian Gaming Commission is proposing revisions to its regulations that would provide for an expedited review of a tribe's facility license information and streamline the submittal of information relating to a proposed facility license. The proposed rule also provides for tribes to submit a certification attesting that the gaming operation is being conducted in a manner that adequately protects the environment and the public health and safety. Further, the proposed rule requires a facility license to be submitted before the opening of any new place, facility, or location on Indian lands where class II or III gaming will occur. Likewise, a tribe must notify the Chair if a facility license is terminated, expires, or if a gaming place, facility, or location closes or reopens, unless the closure is seasonal or temporary.

DATES:

The agency must receive comments on or before April 2, 2012.

ADDRESSES:

You may submit comments by any one of the following methods, however, please note that comments sent by electronic mail are strongly encouraged.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposed rules.

II. Background

The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497, 25 U.S.C. 2701et seq.,was signed into law on October 17, 1988. The Act establishes the National Indian Gaming Commission (“Commission”) and sets out a comprehensive framework for the regulation of gaming on Indian lands. The purposes of IGRA include: providing a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments; ensuring that the Indian tribe is the primary beneficiary of the gaming operation; and declaring that the establishment of independent federal regulatory authority for gaming on Indian lands, the establishment of federal standards for gaming on Indian lands, and the establishment of a National Indian Gaming Commission, are necessary to meet congressional concerns regarding gaming and to protect such gaming as a means of generating tribal revenue. 25 U.S.C. 2702.

The Act provides for tribal gaming on Indian lands within such tribe's jurisdiction. 25 U.S.C. 2710. The Act further provides the Chair and the Commission with civil regulatory authority for any violation of any provision of IGRA, Commission regulations, or approved tribal gaming ordinances. 25 U.S.C 2713. The Act requires “a separate license issued by the Indian tribe shall be required for each place, facility, or location on Indian lands at which class II (and class III) gaming is conducted.” 25 U.S.C. 2710(b)(1) and (d)(1)(A)(iii). Further, IGRA requires that tribal ordinances provide that “the construction and maintenance of the gaming facilities, and the operation of that gaming is conducted in a manner which adequately protects the environment and public health and safety.” 25 U.S.C. 2710(b)(2)(E).

Part 559 serves three purposes. The first is to receive information from tribes about the Indian lands status of each gaming facility. The second is to obtain information from tribal governments certifying that the construction, maintenance, and operation of the gaming facilities are conducted in a manner that adequately protects the environment and the public health and safety, as required by the IGRA. Finally, Part 559 serves to inform the Commission of those places, facilities, or locations at which Indian gaming is presently being conducted.

On November 18, 2010, the Commission issued a Notice of Inquiry and Notice of Consultation (NOI) advising the public that the Commission was conducting a comprehensive review of its regulations and requesting public comment on which of its regulations were most in need of revision, in what order the Commission should review its regulations, and the process the Commission should utilize to make revisions. 75 FR 70680 (Nov. 18, 2010). Part 559 was included in the first group of regulations reviewed in consultation.

II. Development of the Proposed Rule

The Commission conducted multiple tribal consultations as part of its review of part 559. Tribal consultations were held in every region of the country and were attended by numerous tribal leaders or their representatives. In addition to tribal consultations, on June 11, 2011, the Commission requestedpublic comment on a preliminary draft of amendments to part 559.

A. General Issues

In response to the NOI, several comments stated that the current facility licensing regulations exceeded the Commission's authority under IGRA. However, many comments also stated that the June 11, 2011 draft facility licensing regulations more closely tracked the text and purpose of IGRA. Another commentator suggested that self-regulating tribes be exempted from this requirement. However, facility licenses are a statutory requirement and even self-regulating tribes must issue facility licenses. Therefore, the proposed rule does not exempt self-regulating tribes from the facility license requirement.

B. Submission of Indian lands information

The June 11, 2011 preliminary discussion draft amended the timeframe for submittal of the facility license from 120 days to 60 days. It also added a subsection that required the Commission to quickly verify the status of the Indian lands of the place, facility, or location where class II or class III gaming will occur. However, commentators objected to this change, noting that the draft created a new process committing the Chair to act while the tribe waited for the Chair's action. Comments pointed out that there is no legal requirement for an Indian lands determination prior to gaming on that land. The Commission agrees with the comments and has attempted to address this issue in the proposed regulation. The proposed regulation reinstates the 120-day timeframe for submittal of the facility license information to the Commission, while allowing a tribe to request an expedited 60-day review to confirm that the Tribe has submitted the materials required under part 559. The proposed regulation also allows a tribe to request a written confirmation from the Chair that the tribe has submitted the materials required under part 559. Similar to existing part 559, the proposed rule does not require the issuance of a written opinion that the site on which Indian gaming is proposed is Indian lands eligible for gaming, as that term is defined by IGRA.

Several commentators requested that the regulation be clarified to state that tribal governments possess authority to independently issue facility licenses and may open new facilities while the Commission's “verification process” is pending. The Commission agrees that IGRA preserves a tribe's authority to issue facility licenses. The proposed rule further clarifies that the notification process does not require the Commission to verify the Indian lands status within the 120-day timeframe. IGRA limits gaming to Indian lands eligible for gaming under IGRA. If a tribe opens a new facility on lands not eligible for gaming, it does so at the risk of violating IGRA and other applicable laws. Additional comments suggested that the proposed regulation clarify that after the passage of 120 days, there is a presumption that the tribe has provided the required information and that the Commission has verified the Indian land status, unless it notifies the tribe otherwise. The Commission disagrees with such a presumption because Commission action or inaction cannot change IGRA's limitations on which Indian lands are eligible for gaming. Accordingly, the proposed regulation does not require a verification or action on whether the land is Indian land eligible for gaming, as that term is defined in IGRA.

The Commission received comments suggesting that the notice requirements include copies of relevant treaties, statutes, executive orders, court orders, or other documentation, while other comments stated that tribes should not be required to provide documents that should already be in the federal government's possession. The proposed regulation does not change the submission requirements for new facilities. While the Commission agrees that tribes should not be required to submit copies of documents that should already be in the federal government's possession, maintaining this requirement will help to provide certainty to tribes and the Commission that it has all of the relevant information.

C. Notification Requirements for Facility Openings and Closures

Part 559 requires tribes to renew or reissue a facility license at least once every three years. Proposed part 559 eliminates this requirement. The Commission's view is that unless a change to the facility has been made that changes the legal land description, tribes may establish the duration of their facility licenses through tribal law. The preliminary draft regulation still required the tribe to provide the Commission with notice of a facility opening or closing and to provide a copy of each renewed facility license. The proposed rule maintains the approach set forth in the preliminary draft. The proposed rule continues to require submittal of reissued facility licenses whenever they are issued by the tribe.

Comments were varied in their recommendation for the number of days a facility must be closed before notification should be sent to the Commission. Some supported no notification to the Commission for seasonal closures, while others suggested 60 days, 90 days, and 180 days. The proposed rule retains the requirement of notification when a facility license is terminated or not renewed, or when a facility closes or reopens so that the Commission has accurate, up-to-date records of which facilities are operating at any given point in time. However, the proposed rule does not require a tribe to notify the Commission of a seasonal closure or a temporary closure of less than 180 days.

D. Environmental and Public Health and Safety Submission Requirements

In response to the NOI, the Commission received comments which stated that requiring the submittal of EPHS information was onerous, duplicative, and outside the authority and expertise of the Commission. Commentators noted that EPHS issues were already addressed in tribal, state, and federal laws, tribal-state compacts, and inter-governmental agreements. Comments stated that, in addition to tribal governmental departments that regulate such matters, federal agencies already regulate the EPHS issues in Indian country. The Commission agrees that in any particular situation, multiple governmental entities may already regulate EPHS issues at gaming facilities. The proposed rule streamlines the current submittal requirements in part 559 by requiring the submittal of a certification by the tribe attesting that it has determined that the construction, maintenance, and operation of the gaming facility is conducted in a manner that adequately protects the environment and the public health and safety. The proposed rule maintains the Chair's discretion to request additional EPHS information from a tribe. Some comments requested that the proposed rule identify the circumstances under which the Chair could request such information. The proposed draft does not do so, as it is not possible to identify every possible scenario under which the Chair would exercise this discretion.

E. Consolidation of § 502.22 Into § 559.4

Responses to the NOI indicated that the Commission should review § 502.22 in conjunction with the review of part 559. In response to these comments, the Commission proposes incorporating § 502.22 into § 559.4 and repealing§ 502.22. This amendment is intended to promote clarity and effectiveness for the regulated community.

Regulatory MattersRegulatory Flexibility Act

The proposed rule will not have a significant impact on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601,et seq.Moreover, Indian Tribes are not considered to be small entities for the purposes of the Regulatory Flexibility Act.

Small Business Regulatory Enforcement Fairness Act

The proposed rule is not a major rule under the Small Business Regulatory Enforcement Fairness Act, 5 U.S.C. 804(2). This rule does not have an annual effect on the economy of $100 million or more. This rule will not cause a major increase in costs or prices for consumers, individual industries, federal, state or local government agencies or geographic regions and does not have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.

Unfunded Mandate Reform Act

The Commission, as an independent regulatory agency is exempt from compliance with the Unfunded Mandates Reform Act. 2 U.S.C. 1502(1); 2 U.S.C. 658(1).

Takings

In accordance with Executive Order 12630, the Commission has determined that the proposed rule does not have significant takings implications. A takings implication assessment is not required.

Civil Justice Reform

In accordance with Executive Order 12988, the Commission has determined that the proposed rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Executive Order.

National Environmental Policy Act

The Commission has determined that the proposed rule does not constitute a major federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4321,et seq.

Paperwork Reduction Act

The information collection requirements contained in this rule were previously approved by the Office of Management and Budget (OMB) as required by 44 U.S.C. 3501et seq.and assigned OMB Control Number 3141-0012, which expired on January 31, 2011. The NIGC is in the process of reinstating that Control Number.

Text of the Proposed Rules

For the reasons discussed in the preamble, the Commission proposes to revise part 559 to read as follows:

PART 559—FACILITY LICENSE NOTIFICATIONS, RENEWALS, AND SUBMISSIONSSec.559.1What is the scope and purpose of this part?559.2When must a tribe notify the Chair that it is considering issuing a new facility license?559.3When must a tribe submit a copy of a newly issued or renewed facility license to the Chair?559.4What must a tribe submit to the Chair with the copy of each facility license that has been issued or renewed?559.5Does a tribe need to notify the Chair if a facility license is terminated or expires or if a gaming place, facility, or location closes or reopens?559.6May the Chair require a tribe to submit applicable and available Indian lands or environmental and public health and safety documentation regarding any gaming place, facility, or location where gaming will occur?559.7May a tribe submit documents required by this part electronically?Authority:

25 U.S.C. 2701, 2702(3), 2703(4), 2705, 2706(b)(10), 2710, 2719.

§ 559.1What is the scope and purpose of this part?

(a) The purpose of this part is to ensure that each place, facility, or location where class II or III gaming will occur is located on Indian lands eligible for gaming and obtain an attestation certifying that the construction and maintenance of the gaming facility, and the operation of that gaming, is conducted in a manner that adequately protects the environment and the public health and safety, pursuant to the Indian Gaming Regulatory Act.

(b) Each gaming place, facility, or location conducting class II or III gaming pursuant to the Indian Gaming Regulatory Act or on which a tribe intends to conduct class II or III gaming pursuant to the Indian Gaming Regulatory Act is subject to the requirements of this part.

§ 559.2When must a tribe notify the Chair that it is considering issuing a new facility license?

(a) A tribe shall submit to the Chair a notice that a facility license is under consideration for issuance at least 120 days before opening any new place, facility, or location on Indian lands where class II or III gaming will occur.

(1) A tribe may request an expedited review of 60 days and the Chair shall respond to the tribe's request, either granting or denying the expedited review, within 30 days.

(2) Although not necessary, a tribe may request written confirmation from the Chair.

(b) The notice shall contain the following:

(1) The name and address of the property;

(2) A legal description of the property;

(3) The tract number for the property as assigned by the Bureau of Indian Affairs, Land Title and Records Offices, if any;

(4) If not maintained by the Bureau of Indian Affairs, Department of the Interior, a copy of the trust or other deed(s) to the property or an explanation as to why such documentation does not exist; and

(5) If not maintained by the Bureau of Indian Affairs, Department of the Interior, documentation of the property's ownership.

(c) A tribe does not need to submit to the Chair a notice that a facility license is under consideration for issuance for occasional charitable events lasting not more than one week.

§ 559.3When must a tribe submit a copy of a newly issued or renewed facility license to the Chair?

A tribe must submit to the Chair a copy of each newly issued or renewed facility license within 30 days of issuance.

§ 559.4What must a tribe submit to the Chair with the copy of each facility license that has been issued or renewed?

A tribe shall submit to the Chair with each facility license an attestation certifying that by issuing the facility license, the tribe has determined that the construction and maintenance of the gaming facility, and the operation of that gaming, is conducted in a manner which adequately protects the environment and the public health and safety. This means that a tribe has identified and enforces laws, resolutions, codes, policies, standards or procedures applicable to each gaming place, facility, or location that protect the environment and the public health and safety, including standards under a tribal-state compact or Secretarial procedures.

§ 559.5Does a tribe need to notify the Chair if a facility license is terminated or expires or if a gaming place, facility, or location closes or reopens?

A tribe must notify the Chair within 30 days if a facility license is terminated or expires or if a gaming place, facility, or location closes or reopens. A tribe need not provide a notification of seasonal closures or temporary closures with a duration of less than 180 days.

§ 559.6May the Chair require a tribe to submit applicable and available Indian lands or environmental and public health and safety documentation regarding any gaming place, facility, or location where gaming will occur?

A tribe shall provide applicable and available Indian lands or environmental and public health and safety documentation requested by the Chair.

§ 559.7May a tribe submit documents required by this part electronically?

Yes. Tribes wishing to submit documents electronically should contact the Commission for guidance on acceptable document formats and means of transmission.

The Department of Veterans Affairs (VA) proposes to amend its Servicemembers' Group Life Insurance (SGLI) regulations in order to provide that, if a stillborn child is otherwise eligible to be insured by the SGLI coverage of more than one member, the child would be insured by the coverage of the child's SGLI-insured mother.

DATES:

Comments must be received by VA on or before April 2, 2012.

ADDRESSES:

Written comments may be submitted throughhttp://www.Regulations.gov;by mail or hand-delivery to Director, Regulations Management (02REG), Department of Veterans Affairs, 810 Vermont Ave. NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026. Comments should indicate that they are submitted in response to “RIN 2900-AO30—Servicemembers' Group Life Insurance—Stillborn Child Coverage.” Copies of comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1063B, between the hours of 8 a.m. and 4:30 p.m., Monday through Friday (except holidays). Please call (202) 461-4902 for an appointment. (This is not a toll free number.) In addition, during the comment period, comments are available online through the Federal Docket Management System (FDMS) athttp://www.Regulations.gov.

The Veterans' Survivor Benefits Improvements Act of 2001, Public Law 107-14, established a program of family insurance coverage under Servicemembers' Group Life Insurance (SGLI) through which a SGLI-insured service member's insurable dependents could also be insured. Section 1965(10) of title 38, United States Code, defined “insurable dependent” as a service member's spouse or child. Under 38 U.S.C. 1967(a), the child of a SGLI-insured member is automatically insured for $10,000.

Section 1967(a)(4)(B) prohibits an insurable dependent who is a child from being insured at any time under the SGLI coverage of more than one member, i.e., more than one SGLI-insured parent. If a child is otherwise eligible to be insured by the coverage of more than one member, under section 1967(a)(4)(B) the child is insured by the coverage of the member whose eligibility for SGLI occurred first, “except that if that member does not have legal custody of the child, the child shall be insured by the coverage of the member who has legal custody of the child.” Which parent has legal custody of a child is determined in accordance with applicable State law.

Section 402 of the Veterans' Benefits Improvement Act of 2008, Public Law 110-389, expanded the definition of “insurable dependent” for SGLI purposes to include a “member's stillborn child.” On November 18, 2009, VA added paragraph (k) to 38 CFR 9.1 to define the term “member's stillborn child” for purposes of SGLI coverage. 74 FR 59479.

Our research has determined that the law of the 50 States is silent as to which parent of a stillborn child has legal custody of the stillborn child. VA would not be able to determine the legal custodian of a stillborn child in accordance with State law. Therefore, we propose that a stillborn child of two SGLI-covered parents will always be insured under the mother's coverage.

Ease of application is just one reason for adopting such a simple rule. VA proposes this rule also because a stillborn child was exclusively in the mother's physical custody. Furthermore, if the paternity of a stillborn child were in issue, it would be particularly onerous to require a stillborn's father to establish paternity of the stillborn child. It would be more compassionate under such circumstances to simply apply a standing rule that obviates the need for such determinations. We therefore propose a rule to amend 38 CFR 9.5 by adding paragraph (e) to provide that, if a stillborn child is otherwise eligible to be insured by the coverage of more than one member, the stillborn child would be insured by the coverage of the SGLI-insured mother.

This rule would apply to claims filed on or after the publication of the final rule.

Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in an expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This rule would have no such effect on State, local, and tribal governments or the private sector.

Paperwork Reduction Act

This proposed rule contains no provision constituting a collection of information under the Paperwork Reduction Act (44 U.S.C. 3501et seq.).

Executive Orders 12866 and 13563

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity).Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” which requires review by the Office of Management and Budget (OMB), as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

VA has examined the economic, interagency, legal, and policy implications of this proposed rule and has determined it not to be a significant regulatory action under Executive Order 12866.

Regulatory Flexibility Act

The Secretary hereby certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601et seq.This proposed rule will directly affect only individuals and will not directly affect small entities. Therefore, pursuant to 5 U.S.C. 605(b), this proposed rule is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

Catalog of Federal Domestic Assistance

The catalog of Federal Domestic Assistance Program number and the title for this regulation is 64.103, Life Insurance for Veterans.

Signing Authority

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. John R. Gingrich, Chief of Staff, Department of Veterans Affairs, approved this document on January 22, 2012, for publication.

List of Subjects in 38 CFR Part 9

Life insurance, Military personnel, Veterans.

Dated: January 26, 2012.Robert C. McFetridge,Director of Regulation Policy and Management, Office of the General Counsel, Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs proposes to amend 38 CFR part 9 as follows:

PART 9—SERVICEMEMBERS' GROUP LIFE INSURANCE AND VETERANS' GROUP LIFE INSURANCE

1. The authority citation for part 9 continues to read as follows:

Authority:

38 U.S.C. 501, 1965-1980A, unless otherwise noted.

2. Section 9.5 is amended by adding paragraph (e) and revising the authority citation at the end of the section to read as follows:

§ 9.5Payment of proceeds.

(e) If a stillborn child is otherwise eligible to be insured by the Servicemembers' Group Life Insurance coverage of more than one member, the child shall be insured by the coverage of the child's insured mother.

On December 30, 2011, the EPA published in theFederal Registerour proposal to revise rules that pertain to the regional haze program. In the proposal, the EPA stated that public comments were to be submitted by February 13, 2012. In order to ensure that the public has a sufficient time to analyze our proposed rule, the EPA is extending the public comment period until February 28, 2012.

DATES:

Comments.Comments on the proposed rule published December 30, 2011 (76 FR 82219) must be received on or before February 28, 2012.

ADDRESSES:

Comments.Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2011-0729, by one of the following methods:

•Hand Delivery:U.S. Environmental Protection Agency, EPA West (Air Docket), 1301 Constitution Avenue, Northwest, Room 3334, Washington, DC 20004, Attention Docket ID No. EPA-HQ-OAR-2011-0729. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information.

Instructions.Direct your comments to Docket ID No. EPA-HQ-OAR-2011-0729. The EPA's policy is that all comments received will be included in the public docket without change and may be made available online atwww.regulations.gov,including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected throughwww.regulations.govor email. Thewww.regulations.govWeb site is an “anonymous access” system, which means the EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to the EPA without going throughwww.regulations.gov,your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, the EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROMyou submit. If the EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, the EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, avoid any form of encryption, and be free of any defects or viruses. For additional information about the EPA's public docket, visit the EPA Docket Center homepage atwww.epa.gov/epahome/dockets.htm.

Docket.All documents in the docket are listed in thewww.regulations.gov index.Although listed in the index, some information is not publicly available,e.g.,CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically inwww.regulations.govor in hard copy at the U.S. Environmental Protection Agency, Air Docket, EPA/DC, EPA West Building, Room 3334, 1301 Constitution Ave., NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the Air Docket is (202) 566-1742.

I. General InformationA. What should I consider as I prepare my comments for the EPA?

1.Submitting CBI.Do not submit this information to the EPA throughwww.regulations.govor email. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD ROM that you mail to the EPA, mark the outside of the disk or CD ROM as CBI and then identify electronically within the disk or CD ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. Send or deliver information identified as CBI only to the following address: Roberto Morales, OAQPS Document Control Officer (C404-02), U.S. EPA, Research Triangle Park, NC 27711, Attention Docket ID No. EPA-HQ-OAR-2011-0729.

• Explain your views as clearly as possible, avoiding the use of profanity or personal threats.

• Make sure to submit your comments by the comment period deadline identified.

B. Where can I get a copy of this document and other related information?

In addition to being available in the docket, an electronic copy of this notice will also be available on the World Wide Web (WWW). Following signature, a copy of this notice will be posted athttp://www.epa.gov/ttn/oargpg/new.html.

EPA is proposing to make nonconformance penalties (NCPs) available to manufacturers of heavy-duty diesel engines in model years 2012 and later for emissions of oxides of nitrogen (NOx). In general, the availability of NCPs allows a manufacturer of heavy-duty engines (HDEs) whose engines fail to conform to specified applicable emission standards, but do not exceed a designated upper limit, to be issued a certificate of conformity upon payment of a monetary penalty to the United States Government. The proposed upper limit associated with these NCPs is 0.50 grams of NOx per horsepower-hour.

DATES:

Comments:Comments on all aspects of this proposal must be received on or before April 4, 2012. See theSUPPLEMENTARY INFORMATIONsection on “Public Participation” for more information about written comments.

Public Hearings:EPA will hold a public hearing on the following date: March 5, 2012. The hearing will start at 10 a.m. local time and continue until 5 p.m. or until everyone has had a chance to speak. See “How Do I Participate in the Public Hearings?” below at VII. B. under theSUPPLEMENTARY INFORMATIONsection on “Public Participation” for more information about the public hearings.

ADDRESSES:

Submit your comments to Docket EPA-HQ-OAR-2011-1000, by one of the following methods:http://www.regulations.gov:Follow the on-line instructions for submitting comments.

Docket:All documents in the docket are listed in thehttp://www.regulations.govindex. Although listed in the index, some information isnot publicly available,e.g.,confidential business information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy in the docket. Publicly available docket materials are available either electronically inhttp://www.regulations.govor in hard copy at the following locations:

EPA:EPA Docket Center, EPA/DC, EPA West, Room 3334, 1301 Constitution Avenue NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Air Docket is (202) 566-1742.

This proposed action would affect you if you produce or import new heavy-duty diesel engines which are intended for use in highway vehicles such as trucks and buses or heavy-duty highway vehicles. The table below gives some examples of entities that may have to follow the proposed regulations. But because these are only examples, you should carefully examine the proposed and existing regulations in 40 CFR part 86. If you have questions, call the person listed in theFOR FURTHER INFORMATION CONTACTsection above.

CategoryNAICSaCodesExamples of potentially regulated entitiesIndustry336112Engine and truck manufacturers.336120aNorth American Industry Classification System (NAICS).Table of ContentsI. Statutory Authority and Regulatory BackgroundA. Statutory AuthorityB. Background Regarding Nonconformance Penalty RulesC. 2007 and 2010 NOXStandardsII. Interim Final RuleIII. Nonconformance Penalties for 2012 and Later Heavy-Duty Engines and Heavy-Duty VehiclesA. NCP Eligibility: Emission Standards for Which NCPs Are Being Established in This Interim Final RuleB. NCP Eligibility: Emission Standards for Which NCPs Are Not ProposedIV. Penalty RatesA. ParametersB. Issues and Alternatives for NCPsV. Economic ImpactVI. Environmental ImpactVII. Public ParticipationA. How do I submit comments?B. Will there be a public hearing?VIII. Statutory and Executive Order ReviewsA. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory ReviewB. Paperwork Reduction ActC. Regulatory Flexibility ActD. Unfunded Mandates Reform ActE. Executive Order 13132 (Federalism)F. Executive Order 13175 (Consultation and Coordination With Indian Tribal GovernmentsG. Executive Order 13045: “Protection of Children From Environmental Health Risks and Safety Risks”H. Executive Order 13211 (Energy Effects)I. National Technology Transfer Advancement ActJ. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income PopulationsIX. Statutory Provisions and Legal AuthorityI. Statutory Authority and Regulatory BackgroundA. Statutory Authority

Section 206(g) of the Clean Air Act (the Act), 42 U.S.C. 7525(g), allows EPA to promulgate regulations permitting manufacturers of heavy-duty engines (HDEs) or heavy-duty vehicles (HDVs) to receive a certificate of conformity for HDEs or HDVs that exceed a federal emissions standard, but do not exceed an upper limit associated with that standard, if the manufacturer pays a nonconformance penalty (NCP) established by rulemaking. Congress adopted section 206(g) in the Clean Air Act Amendments of 1977 as a response to a concern with requiring technology-forcing emissions standards for heavy-duty engines. The concern was if strict technology-forcing standards were promulgated, then some manufacturers might be unable to comply initially and would be forced out of the marketplace. NCPs were intended to remedy this concern. The nonconforming manufacturers would have a temporary alternative that would permit them to sell their engines or vehicles by payment of a penalty. At the same time, conforming manufacturers would not suffer a competitive disadvantage compared to nonconforming manufacturers, because the NCPs would be based, in part, on money saved by the nonconforming manufacturer.

Under section 206(g)(1), NCPs may be offered for HDVs or HDEs. The penalty may vary by pollutant and by class or category of vehicle or engine. Section 206(g)(3) requires that NCPs:

• Account for the degree of emission nonconformity;

• Increase periodically to provide incentive for nonconforming manufacturers to achieve the emission standards; and

• Remove the competitive disadvantage to conforming manufacturers.

Section 206(g) authorizes EPA to require testing of production vehicles or engines in order to determine the emission level upon which the penalty is based. If the emission level of a vehicle or engine exceeds an upper limit of nonconformity established by EPA through regulation, the vehicle or engine would not qualify for an NCP under section 206(g) and no certificate of conformity could be issued to the manufacturer. If the emission level is below the upper limit but above the standard, that emission level becomes the “compliance level,” which is also the benchmark for warranty and recall liability. The manufacturer who elects to pay the NCP is liable for vehicles or engines that exceed the compliance level in use. The manufacturer does not have in-use warranty or recall liability for emissions levels above the standard but below the compliance level.

B. Background Regarding Nonconformance Penalty Rules

Since the promulgation of the first NCP rule in 1985, subsequent NCP rules generally have been described as continuing “phases” of the initial NCP rule. The first NCP rule (Phase I), sometimes referred to as the “generic” NCP rule, established three basic criteria for determining the eligibility of emission standards for nonconformance penalties in any given model year (50 FR 35374, August 30, 1985). As described in section III. A. of this notice,we have determined that these criteria have been met for one manufacturer. (For regulatory language, see 40 CFR 86.1103-87.) The first criterion is that the emission standard in question must become more difficult to meet. This can occur in two ways, either by the emission standard itself becoming more stringent, or due to its interaction with another emission standard that has become more stringent. Second, substantial work must be required in order to meet the emission standard. EPA considers “substantial work” to mean the application of technology not previously used in that vehicle or engine class/subclass, or a significant modification of existing technology, in order to bring that vehicle/engine into compliance. EPA does not consider minor modifications or calibration changes to be classified as substantial work. Third, EPA must find that a manufacturer is likely to be noncomplying for technological reasons (referred to in earlier rules as a “technological laggard”). Prior NCP rules have considered such a technological laggard to be a manufacturer who cannot meet a particular emission standard due to technological (not economic) difficulties and who, in the absence of NCPs, might be forced from the marketplace. As described in section III. A. of this notice, we have determined that this criterion has been met for one manufacturer. This manufacturer notified us late in 2011 that it would not have enough emission credits for its model year 2012 heavy heavy-duty engines.

The criteria and methodologies established in the 1985 NCP rule have since been used to determine eligibility and to establish NCPs for a number of heavy-duty emission standards. Phases II, III, IV, V, and VI published in the period from 1985 to 2002, established NCPs that, in combination, cover the full range of heavy-duty—from heavy light-duty trucks (6,000-8,500 pounds gross vehicle weight) to the largest diesel truck and urban bus engines. NCPs have been established for hydrocarbons (HC), carbon monoxide (CO), nitrogen oxides (NOX), and particulate matter (PM). The most recent NCP rule (67 FR 51464, August 8, 2002) established NCPs for the 2004 and later model year NOXstandard for heavy-duty diesel engines (HDDEs). The NCP rulemaking phases are summarized in greater detail in the Interim and Proposed Technical Support Document for this rulemaking.

C. 2007 and 2010 NOXStandards

The 0.20 g/hp-hr NOXstandard that applies for current and future heavy-duty engines was adopted January 18, 2001 (66 FR 5001), and first applied in the 2007 model year. However, because of phase-in provisions adopted in that rule and use of emission credits generated by manufacturers for early compliance, manufacturers have been able to continue to produce engines with NOXemissions greater than 0.20 g/hp-hr. The phase-in provisions ended after model year 2009 so that the 0.20 g/hp-hr NOXstandard was fully phased-in for model year 2010. Equally important, the cap applicable to Family Emission Limits (FELs)1for credit using engine families was lowered to 0.50 g/hp-hr beginning in model year 2010. Because of these changes that occurred in model year 2010, the 0.20 g/hp-hr NOXemission standard is often referred to as the 2010 NOXemission standard, even though it applied to engines as early as model year 2007.

1FELs serve are emission levels specified by the manufacturer that serve as the applicable emission standard for engines participating in the emission averaging program. The FEL cap is the highest FEL to which a manufacturer may certify an engine using emission credits.

While some manufacturers retain NOXemission credits that currently allow them to produce engines with NOXemissions as high as 0.50 g/hp-hr, we expect that one of these manufacturers could exhaust their supplies of credits in the near future.

II. Interim Final Rule

EPA is also publishing an Interim Final Rule (IFR) addressing NCPs for heavy heavy-duty engines. The NCPs in the Final Rule for this NPRM are expected to supersede the NCPs being promulgated in that Interim Final Rule. For example, if the Final Rule is published September 14, 2012, it would likely have an effective date of November 13, 2012. Should the Final Rule establish different NCPs for heavy heavy-duty engines than the interim NCPs, we could apply those new NCPs to any engines produced on or after November 13, 2012, instead of the interim NCPs.

Note that Docket Number EPA-HQ-OAR-2011-1000 is being used for both the Interim Final Rule and this NPRM.

III. Nonconformance Penalties for 2012 and Later Heavy-Duty Engines and Heavy-Duty VehiclesA. NCP Eligibility: Emission Standards for Which NCPs Are Being Established in This Interim Final Rule(1) Heavy Heavy-Duty Diesel NOXStandard

As discussed in section I.B., EPA must determine that three criteria are met in order to determine that an NCP should be established in any given model year. For the 2010 NOXstandard, we believe these criteria have been met for heavy heavy-duty diesel engines and it is therefore appropriate to establish NCPs for this standard beginning in the current model year.

The first criterion requires that the emission standard in question must become more difficult to meet. This is the case with the 2010 NOXstandard. The previous emission standard for this category is a combined NMHC+NOXstandard of 2.4 g/hp-hr, or optionally a 2.5 g/hp-hr NMHC+NOXwith a limit of 0.5 g/hp-hr NMHC.2The 2010 (i.e.,current) standards are 0.20 g/hp-hr for NOXand 0.14 g/hp-hr for NMHC. When promulgated, the Agency concluded that the 0.20 g/hp-hr NOXstandard was a technology forcing standard. Second, all heavy heavy-duty diesel engines currently certified to the 0.20 g/hp-hr standard without using credits are using new aftertreatment systems to meet this standard.3It is therefore logical to conclude the standard is more difficult to meet and that substantial work was required to meet the emission standard.

2NMHC stands for non-methane hydrocarbons, which is a measure of total hydrocarbons with the methane emissions subtracted out. For typical on-highway diesel fueled heavy-duty engines, methane emissions are on the order of 10 percent of the total hydrocarbon emissions.

3For this proposed rule, EPA describes those manufacturers that have achieved the 0.20 g/hp-hr emission standard as “compliant” or “complying” manufacturers, and those that have not as the “noncompliant” or “noncomplying” manufacturers. However, it is important to clarify that manufacturers certifying above the 0.20 g/hp-hr NOXemission standard using emission credits are in compliance with regulations as long as they have enough emission credits to offset their total NOXemissions above the standard.

Third, EPA is promulgating NCPs for heavy heavy-duty diesel engines because we have concluded that there is a significant likelihood that they will be needed by an engine manufacturer that has not yet met the requirements for technological reasons. One manufacturer is currently using NOXcredits to certify all of its heavy heavy-duty diesel engines at nearly the FEL cap level of 0.50 g/hp-hr. Based on its current credit balance and projected sales for this service class, we do not expect this manufacturer to have sufficient credits to cover its entire model year 2012 production. This manufacturer intends to use a different technology to meet the NOXstandard but has not yet submitted an application for the 2012 model year with NOXemissions at or below the 0.20 g/hp-hr standard. Since it has not yet submitted an application for certification for any model year 2012 heavy heavy-dutydiesel engines that would not require emission credits, we believe it is a reasonable possibility that this manufacturer may not be able to comply for technological reasons with respect to the 2010 NOXstandards for heavy heavy-duty diesel engines. This manufacturer notified us late in 2011 that it would not have enough emission credits for its model year 2012 heavy heavy-duty engines.

(2) Medium Heavy-Duty Diesel NOXStandard

EPA believes that the first two NCP criteria have also been met for medium heavy-duty diesel engines. We have also determined that there is a significant chance that NCPs will be needed by an engine manufacturer that has not yet met the 2010 NOXstandards for medium heavy-duty diesel engines for technological reasons. As is true for heavy heavy-duty engine, one manufacturer is currently using NOXcredits to certify all of its medium heavy-duty diesel engines above 0.20 g/hp-hr. This manufacturer intends to use a different technology to meet the NOXstandard but has not yet submitted an application for any upcoming model year with NOXemissions at or below the 0.20 g/hp-hr standard. Since it has not yet submitted an application for certification for any model year medium heavy-duty diesel engines that would not require emission credits, we believe it is prudent to promulgate NCPs given the possibility that this manufacturer may not be able to comply for technological reasons with respect to the 2010 NOXstandards for medium heavy-duty diesel engines before it exhausts its supply of emission credits for medium heavy-duty engines.

EPA believes that the first two NCP criteria have been met for the 2010 NOXstandard for light heavy-duty diesel engines. However, we have not determined that any manufacturer of light heavy-duty diesel engines will be unable to certify to the 2010 NOXstandard through use of emission credits until it develops emissions controls that allow its light heavy-duty diesel engines to achieve NOXemissions at or below 0.20 g/hp-hr.

(2) Heavy-Duty Gasoline Engine Standards

In a final rule published on January 18, 2001 (66 FR 5001), EPA established more stringent emission standards for all heavy-duty gasoline (or “Otto-cycle”) vehicles and engines. These standards took two forms: a chassis-based set of standards for complete vehicles under 14,000 pounds GVWR (the chassis-based program), and an engine-based set of standards for all other Otto-cycle heavy-duty engines (the engine-based program). Each of the two programs has an associated averaging, banking, and trading (ABT) program. The new standards generally took effect starting with the 2008 model year, and all manufacturers are in compliance with them.

(3) Heavy-Duty Diesel Engine NMHC, CO, and PM Standards

EPA adopted new NMHC and PM for model year 2007 and later heavy-duty engines in the same rule that set the 2010 NOXemission standard (66 FR 5001, January 18, 2001). The CO standard was not changed. We are not considering NCPs for any of these other standards because all manufacturers are already fully compliant with them.

(4) Heavy-Duty CO2Standards

In a final rule published on September 15, 2011 (76 FR 57106), EPA established new CO2emission standards for all heavy-duty vehicles and engines. We are not considering NCPs for any of these standards at this time because we currently do not have a basis to conclude that a technological laggard is likely to develop.

We are proposing to add a new regulatory provision related to these CO2emission standards. The provision would prohibit generating CO2emission credits from engines paying NCPs for NOX. Given the general tradeoff between CO2and NOXemissions, we were concerned that a manufacturer capable of meeting the 0.20 g/hp-hr NOXemission standard could choose to pay an NCP in order to generate CO2credits by recalibrating its engines for higher NOXemissions and lower CO2. There are two reasons this would be inappropriate. First, emission credits are supposed to provide an incentive for a manufacturer to go beyond what is normally required to meet emission standards. However, allowing manufacturers to generate CO2credits while paying NCPs would actually create an incentive for manufacturers to do less than is required to meet the emission standards. Equally important, NCPs have always been intended for manufacturers that cannot meet an emission standard for technological reasons rather than manufacturers choosing not to comply.

IV. Penalty Rates

This proposed rule is the most recent in a series of NCP rulemakings. These are referred to as Phases and are referenced below.4The discussions of penalty rates in those rulemakings are incorporated by reference. This section briefly reviews the penalty rate formula originally promulgated in the Phase I rule (currently found at 40 CFR 86.1113-87) and discusses how EPA arrived at the proposed penalty rates.

The penalty rates being established in this rule rely on the existing NCP regulatory structure. Thus, the only changes being made to the regulations are updates to the cost parameters to reflect the compliance costs for the 2010 standards, setting of the upper limit, and clarifying in § 86.1104-91 that EPA may set the upper limit at a level below the previous standard if we determine that the lower level is achievable by all engines.

The NCP rates being proposed are specified for model year 2012. As required by the Clean Air Act, the existing regulations include a formula that increases the penalty rates with each new model year. We proposed to apply this annual adjustment formula to the NCPs by setting the 2012 model year as year number one. Traditionally, NCPs are available the first year of the new emission standard and that becomes year one for purposes of the annual escalator. However, EPA believes the 2012 model year is the correct year for the first year of the escalator calculation even though the NOXemission standard began in 2010.

A. Parameters

As in the previous NCP rules, we are specifying the NCP formula for each standard using the following parameters: COC50, COC90, MC50, F, and UL. The NCP formula is the same as that promulgated in the Phase I rule. As was done in previous NCP rules, costs consider additional manufacturer costs and additional owner costs, but do not consider certification costs because both complying and noncomplying manufacturers must incur certification costs. COC50is an estimate of the industry-wide average incremental cost per engine (references to engines are intended to include vehicles as well) associated with meeting the standard for which an NCP is offered, compared withmeeting the upper limit. COC90is an estimate of the 90th percentile incremental cost per-engine associated with meeting the standard for which an NCP is offered, compared with meeting the associated upper limit. Conceptually, COC50represents costs for a typical or average manufacturer, while COC90represents costs for the manufacturers with the highest compliance costs.

MC50is an estimate of the industry-wide average marginal cost of compliance per unit of reduced pollutant associated with the least cost effective emission control technology installed to meet the new standard. MC50is measured in dollars per g/hp-hr for heavy-duty engines. F is a factor used to derive MC90, the 90th percentile marginal cost of compliance with the NCP standard for engines in the NCP category. MC90defines the slope of the penalty rate curve near the standard and is equal to MC50multiplied by F. UL is the upper limit above which no engine may be certified.

The derivation of the cost parameters is described in a support document entitled “Interim and Proposed Technical Support Document: Nonconformance Penalties for 2012 and later Highway Heavy-Duty Diesel Engines,” which is available in the public docket for this rulemaking. All costs are presented in 2011 dollars.

(1) Upper Limit

We are proposing to revise the regulations in § 86.1104-91 to clarify that EPA may set (during rulemaking) the upper limit at a level below the previous standard if we determine that the lower level is achievable by all engines. We would also specify that EPA could set the upper limit at a level above the previous standard in unusual circumstances, such as those that occurred for heavy heavy-duty engines with the 2004 standards. As described below, we are also establishing the upper limit for this NCP rule at 0.50 g/hp-hr. These are the only regulatory changes being made with respect to the upper limit.

The upper limit is the emission level established by regulation above which NCPs are not available and a heavy duty engine cannot be certified or introduced into commerce. CAA section 206(g)(2) refers to the upper limit as a percentage above the emission standard, set by regulation, that corresponds to an emission level EPA determines to be “practicable.” The upper limit is an important aspect of the NCP regulations not only because it establishes an emission level above which no engine may be certified, but it is also a critical component of the cost analysis used to develop the penalty rates. The regulations specify that the relevant costs for determining the COC50and the COC90factors are the difference between an engine at the upper limit and one that meets the applicable standards (see 40 CFR 86.1113-87).

The regulatory approach adopted under the prior NCP rules sets the default Upper Limit (UL) at the prior emission standard when a prior emission standard exists and is then changed to become more stringent. EPA concluded that the upper limit should be reasonably achievable by all manufacturers with vehicles in the relevant class. It should be within reach of all manufacturers of HDEs or HDVs that are currently allowed so that they can, if they choose, pay NCPs and continue to sell their engines and vehicles while finishing their development of fully complying engines. A manufacturer of a previously certified engine or vehicle should not be forced to immediately remove an HDE or HDV from the market when an emission standard becomes more stringent. The prior emissions standard generally meets these goals because manufactures have already certified their vehicles to that standard.

In the past, EPA has rejected suggestions that the upper limit should be more stringent than the prior emission standard because it would be very difficult to identify a limit that could be met by all manufacturers. For this rule, however, all manufacturers are currently certifying all of their engines at or below the 0.50 g/hp-hr FEL cap. Thus, since NCPs were not intended to allow manufacturers to increase emissions, we are setting the upper limit for this NCP rule at 0.50 g/hp-hr NOX. This will conform to the purpose of NCPs, which is to allow manufacturers to continue selling engines they are producing, but not to allow backsliding.

(2) Cost Parameter Values

The regulations being adopted specify that the values in Table 1 (in 2011 dollars) be used in the NCP formula for the 2012 and later model year NOXstandard of 0.20 g/hp-hr for diesel heavy-duty engines. The basis is summarized here. The complete derivation of these parameters is described in the Interim and Proposed Technical Support Document for this rulemaking. We request comment on our estimates of these parameters.

We also considered other methodologies for estimating the incremental compliance costs between the upper limit and the standard. We rejected these alternatives because we are not confident that we could estimate the costs with sufficient accuracy or describe our basis without revealing confidential business information. Moreover, we have no reason to believe that these alternative methodologies would have been better with respect to the statutory requirement to remove the competitive disadvantage of the complying manufacturers.

(a) General Methodology

Based on our review of the various hypothetical baseline engine designs, we selected a straightforward “baseline engine” technology package with associated costs that were determinable within a reasonably high degree of certainty. This approach best limited the sensitivity of the penalty rate versus small variations in any of the “baseline engine” technology package elements. This cost stability mitigated the hypothetical nature of the “baseline engine” technology package, which, in turn, led to a penalty rate that we believe is reasonable. As is described in the TSD, we believe estimating costs by this approach is the least speculative method to determine compliance costs.

We selected a baseline engine technology package that would employ the same basic emission controls used to meet the 2007 NOXand PM emission standards (e.g.cooled exhaust gas recirculation), optimized turbo-charging, optimized fuel injection, diesel particulate filters), plus liquid urea based Selective Catalytic Reduction (SCR) NOXemissions control technology with an appropriately sized tank for the diesel exhaust fluid (DEF). Further details are provided in this rule's TSD. While EPA selected the baseline engine (or upper limit engine) to be a fully optimized, SCR-equipped engine that complies with all other emission standards and requirements, the NCPs may be used for engines using other technologies.

This approach differs slightly from that used In previous NCP rules, where EPA based the NCPs directly on an average of actual compliance costs for all manufacturers. This was appropriate in those prior rules because each of the manufacturers had actually produced engines at the upper limit (which was usually the previous emission standard). It was relatively straightforward for them to provide us with a confidential engineering analysis of the costs they actually incurred: the real costs of additional hardware and fluids and the differences in performance characteristics. We have always sought full understanding of the manufacturers' inputs, and for previous NCP rules it was also reasonable for EPA to concludethat the manufacturers' input accurately reflected the manufacturers' actual costs because the costs were derived directly from actual in-production engine information. In the case of this NCP rule, however, compliant manufacturers have not designed and optimized in-production engines for the U.S. market at 0.50 g/hp-hr NOX(the upper limit). Thus, a compliance cost estimate based directly on actual experience for in-production engines was not available for this NCP rule.

Instead of averaging actual costs (because none were available), the NCP penalty formulas for this rule are based primarily on EPA's estimate of the cost difference between an engine emitting at the upper limit (the “baseline engine”) and one emitting at the standard (the “compliant engine”). We requested cost of compliance information from several engine manufacturers and used that information to inform our own analysis of compliance costs, as described in the Interim and Proposed Technical Support Document. The engine manufacturers we contacted approached this cost analysis in the same way we did. That is, the scenarios we and the manufacturers considered were all based upon hypothetical baseline engine designs that were intended to meet the 0.50 g/hp-hr NOXupper limit.

It is worth noting that each of the five engine manufacturers we contacted considered hypothetical baseline engines with different technology packages. Two complying manufacturers based their compliance costs on a baseline engine equipped with similar (but not identical) hardware as EPA; another on an SCR-equipped engine without exhaust gas recirculation, and a fourth on its estimation of the non-complying engines produced by a competitor. All four manufacturers meeting the 0.20 g/hp-hr NOXstandard compared the costs for their hypothetical baseline engines to the costs for their actual compliant engines. The one non-SCR manufacturer we contacted (that has not yet certified any engines with NOXemissions at 0.20 g/hp-hr) provided its projections of what it will spend to bring its current 2011 engine into compliance without the use of emission credits.

(b) Calculated Values

The most significant of the NCP parameters is the 90th percentile costs of compliance, COC90, which defines the penalty for engines emitting at the upper limit. The value of COC50only matters when EPA estimates that marginal compliance costs change as the compliance level approaches the standard. In such cases, COC50defines that point on the curve at which the slope changes. We estimated COC90and COC50by assuming the baseline engine would have been an SCR equipped engine with NOXemissions at 0.50 g/hp-hr and that it looked very similar to an engine with NOXemissions at 0.20 g/hp-hr. However, the higher NOXemissions of the baseline engine would allow the use of less expensive hardware and would require less consumption of liquid urea (also known as diesel emission fluid or “DEF”).

We estimated the marginal costs of compliance as being equal to the total incremental costs of compliance divided by 0.30 g/hp-hr (the difference between the upper limit and the standard). This assumes that the cost to reduce emissions from 0.30 g/hp-hr to 0.20 g/hp-hr is not significantly different from the cost to reduce emissions from 0.50 g/hp-hr to 0.40 g/hp-hr. This results in a penalty curve for heavy heavy-duty engines that is a straight line, which in turn makes our estimate of the average cost of compliance irrelevant to the calculation of the penalty. In other words, the COC50point lies directly between zero cost at 0.20 g/hp-hr and COC90at the Upper Limit of 0.50 g/hp-hr NOX. The penalty paid for engines at the upper limit would be equal to EPA's estimate of the highest marginal cost paid by a complying manufacturer for the same emission range.

The calculation parameters listed in Table 1 are used to calculate the penalty rate. These parameters are used in the penalty rate formulas which are defined in the existing NCP regulations (See 40 CFR 86.1113(a)(1) and (2)). Using the parameters in Table 1, and the equations in the existing NCP regulations, we have plotted penalty rates versus compliance levels in Figure 1 and Figure 2 below. This penalty curve is for the first year of use of the NCPs (i.e.,the annual adjustment factors specified in the existing NCP regulations have been set equal to one).

The Clean Air Act NCP provisions require that the penalty be set at such a level that it removes any competitive disadvantage to a complying manufacturer by requiring non-complying manufacturers to pay NCPs. Our methodology for developing the NCP is detailed in the Interim and Proposed Technical Support Document. Our technology approach includes relatively minor hardware upgrades, calibration changes, and increased use of DEF. For the reasons described in the Interim and Proposed Technical Support Document, we believe that the NCPs being established in this rulemaking will remove any competitive disadvantage that complying manufacturers may face.

EP31JA12.018EP31JA12.019B. Issues and Alternatives for NCPs

The analysis presented in detail in the Interim and Proposed Technical Support Document deals with an assessment of the cost of compliance, using essentially the same methodology that has historically been used to establish NCPs. We believe that our estimates of the costs are appropriate and that the methodology is sound. As noted earlier, section 206(g)(3) specifies certain requirements for NCPs. The requirements for the NCP to account for the degree of emission nonconformity, and to increase periodically have been built into the regulatory structure such that they are automatically achieved with each new phase of NCPs. However, the Clean Air Act also requires EPA to set the NCPs “to remove any competitive disadvantage tomanufacturers whose engines or vehicles achieve the required degree of emission reduction.” This section discusses several issues and alternatives that we have evaluated, especially in the context of this third requirement.

(1) Competitive Advantage for Non-Complying Manufacturers

In establishing prior NCP rules, we have frequently made it clear that satisfying the statutory objective of protecting the complying manufacturer was paramount. The generic NCP rule established an approach which attempts to remove any competitive disadvantage to complying manufacturers by assessing a cost to the manufacturer of a non-complying engine in the form of an NCP, with the expectation that this cost is at least equivalent to or exceeds the value of the competitive benefit gained by building a noncomplying engine. Imposing such a cost is a way to level the playing field without interfering in the actual marketing or pricing of the engines. However, since the issue of competitive advantage involves many subjective factors, the regulatory structure cannot by itself ensure that no competitive advantage remains.

A manufacturer of a non-complying engine generally gains a competitive advantage or benefit of two types. The first typically involves production expenses saved by not producing a complying engine, such as fixed costs and hardware costs. The second category involves, in some cases, the competitive benefits gained by producing an engine that has some convenience or better performance characteristics compared to a complying engine.

The first category is easier to quantify, as it involves considering costs directly incurred by the industry, and it is generally easier to get a fuller quantification of amounts in categories such as hardware costs. The second category is much harder to quantify with certainty. As discussed with respect to DEF and fuel consumption, the actual amount of costs or savings to the operator will vary based on several factors. An even harder to quantify competitive advantage is the benefit in the marketplace from producing an engine that is, or may be perceived to be, more convenient to operate.

The factors that affect the issue of whether the proposed NCP would remove competitive disadvantage involve the purchase price, operating cost, and purchaser perception. Even with an NCP set at a level which addresses quantifiable cost differences between complying and non-complying engines, in the eyes of the purchaser there still may be an advantage to paying the higher first cost for an engine (including the NCP) with known performance.

It is clear that producing engines that comply with a 0.20 g/hp-hr NOXemission standard is more difficult than producing comparable engines with NOXemissions at 0.50 g/hp-hr. Thus it can be presumed that allowing a manufacturer to produce engines with NOXemissions at 0.50 g/hp-hr without paying an NCP would bestow some competitive advantage. The question for this rulemaking is how significant is that advantage? To answer this question, we included an analysis of the heavy-duty truck and engine sales over the past four years. As described in the Interim and Proposed Technical Support Document, the available data do not directly answer this question because of a number of confounding factors. Nevertheless, since these data do not show any substantial shift in market share, it seems unlikely that the competitive advantage that exists is very large. This analysis supports our conclusion that the penalty being adopted is large enough to meet the statutory requirement to remove any competitive disadvantage for complying manufacturers. We request comment on this conclusion.

(2) Baseline Engine Technology

Most manufacturers generally have never had production engines at 0.50 g/hp-hr (the upper limit). Therefore, EPA considered different types of baseline engines. As already noted, we are assuming the baseline engine is already equipped with SCR. Conceptually, what we are doing in this rule is to imagine what would have happened if the prior standard had been 0.50 g/hp-hr. Conversations with manufacturers have generally supported our assumption that had there been a 0.50 g/hp-hr standard, most manufacturers would have chosen to rely on SCR to reduce NOXemissions, especially in the context of the recently adopted greenhouse gas emission standards.

Another important reason we are not assuming a non-SCR baseline engine is that there is only one manufacturer producing such an engine. We are concerned that we would need to rely on confidential business information (CBI) from that one non-SCR manufacturer in order to accurately calculate costs differences, but could not reliably protect such data from disclosure. Normally when we rely on CBI, we collect it from multiple manufacturers and protect the CBI by disclosing only an aggregated summary of the data. Public commenters can comment on the summary, which frequently serves the basis of the rule.

Another disadvantage of assuming a non-SCR baseline engine is that the complying manufacturers did not produce such an engine. Thus they would be unable to provide accurate data for the difference in operating costs between their complying engines and the theoretical baseline engine. Nevertheless, while they generally did not sell SCR engines at 0.50 g/hp-hr, they have development data that allow them to estimate differences in operating costs between a theoretical SCR-equipped baseline engine and their compliant engines.

Another advantage of assuming the baseline engine is equipped with SCR is that it results in a penalty curve that is consistent with the marginal costs of compliance for all NOXvalues between 0.50 g/hp-hr and 0.20 g/hp-hr.

We request comment on our assumption of a baseline engine with SCR that is calibrated to have NOXemissions at 0.50 g/hp-hr. Commenters should address whether assuming a different baseline engine would result in higher or lower penalties, and whether they would better protect the complying manufacturers from a competitive disadvantage.

(3) Costs Not Included

By basing the NCP primarily on the differences in amount of DEF used to reduce emissions and minor hardware costs, the analysis excludes certain other costs, which are described below. Commenters supporting the inclusion of any of these costs should discuss them in the context of the statutory requirement to eliminate competitive disadvantage and whether the costs are associated with other savings or benefits.

Perhaps the most obvious cost not included in the analysis is the significant cost of the SCR hardware itself. However, including this cost would be inconsistent with the baseline engine. Commenters supporting the inclusion of the total hardware costs should do so in the context of changing the baseline engine. For example, it would be important to consider the extent to which SCR hardware cost is offset by significantly lower fuel costs for engines equipped with SCR. We do not believe that we could base the NCP on the cost of SCR hardware without also accounting for the fuel savings.

We are also not including significant fixed costs for research and development (R&D). As noted earlier, the analysis assumes the baseline engineis a fully optimized engine that complies with all other emission standards and requirements. We do not believe that there would be significant R&D costs to recalibrate the SCR system on such an engine to further reduce NOXemission to 0.20 g/hp-hr.

(4) Projected Fuel and DEF Costs

Two of the most significant categories of potential cost are the impact of the standards on DEF and/or fuel consumption rates. However, such cost elements are challenging to estimate because actual DEF and fuel costs will vary based on prices and on the vehicle operation. We, therefore, are requesting comment on our estimates. Specifically, we are requesting comments on the following aspects of our analysis of fuel and DEF costs:

• Projected fuel and DEF prices.

• Estimated changes in fuel and DEF consumption rates.

• Projected annual mileage accumulation rates and miles per gallon.

• Discounting of future costs (discussed in the following section).

For the NCP analysis, we used the Energy Information Administration's (EIA) Annual Energy Outlook 2011 (AEO2011) to project fuel prices through 2035.5AEO2011 contains diesel fuel price projections for the transportation sector through 2035. These fuel prices include federal and state taxes, but do not include county or local taxes. Fuel price varies with time and with location. This is compounded by differences in state and local taxes. This regional variability could potentially impact our analysis. Some trucks may operate locally in an area that has fuel prices significantly higher than the national average. However, we believe that the number of these trucks will be relatively small, and thus did not include a regional fuel price component in our analysis. Nevertheless, we request comment on this issue.

AEO2011 includes five price scenarios—a reference, high oil price, low oil price, high economic growth and low economic growth case. Typically, EPA uses the reference case in our analysis of mobile source rules, and we used that scenario in this proposal, but we welcome comment supporting the use of one of the alternative scenarios.

The annual diesel price per gallon values used in this analysis were adjusted from 2009 dollars (as supplied in AEO2011) to 2011 dollars based on the Consumer Price Index. The annual fuel price projections are included in Appendix A of the Technical Support Document.

DEF prices vary depending on the geography and whether it is purchased by the bottle, by the gallon, or in bulk. Unlike the case for fuel prices, we are not aware of a source which projects a national average DEF cost into the future. For this analysis we used a DEF cost of $2.99 per gallon based on the national retail pump average in November 2011.6We are using a constant value for the DEF price throughout the analysis because we are not aware of any reliable projections that the price will change significantly in the coming years. We welcome comment on our DEF cost projections.

6DieselExhaustFluid.com. Last accessed on November 14, 2011 athttp://www.dieselexhaustfluid.com/.

A change in fuel consumption due to the reduction in NOXemissions would drive a change in fuel costs for this rule. However, as discussed in the Interim and Proposed Technical Support Document, we are estimating that the 0.50 g/hp-hr baseline engine and the fully compliant engine will have the same fuel consumption rates. The two primary reasons for this are the relative importance operators place on keeping fuel consumption rates low for the customer and the upcoming GHG emission standards. The Heavy-Duty GHG rule requires that manufacturers reduce their CO2emissions/fuel consumption starting in 2014 model year by an average of three to five percent from a baseline 2010 model year engine. Thus, a pathway to reduce NOXthat leads to an increase in fuel consumption in 2012 model year would require the manufacturer to apply technologies to recover the increase by 2014 model year. Therefore, our analysis is based on a technology path that does not change the engine-out NOXemissions, and therefore does not impact the fuel consumption of the engine.

Our cost analysis is based on a technology path that reduces tailpipe NOXemissions from the baseline engine with 0.50 g/hp-hr NOXto 0.20 g/hp-hr NOXby increasing DEF consumption. In the Interim and Proposed Technical Support Document, we detail the calculation of the ideal DEF consumption rate change required to reduce NOXemissions by 0.30 g/hp-hr. For the proposal, we calculated an ideal DEF rate increase of 0.38 gallons per 100 gallons of fuel consumed and increased it by five percent to account for overdosing. The proposed NCP costs include DEF consumption costs based on an increase in DEF consumption of 0.40 gallons per 100 gallons of fuel consumed.

Another important factor in estimating DEF and fuel cost is how much fuel a model year 2012 vehicle will use over its lifetime. This is most important for heavy-heavy duty engines. Some vehicles may be scrapped after their useful life (435,000 miles) while others may be rebuilt more than once and not be scrapped until after 2 million miles. Thus, the fuel cost could vary by a factor of four from one vehicle to another. For this analysis, we used the projected mileage accumulation rates generated by the Motor Vehicle Emissions Simulator, more commonly called MOVES, EPA's official mobile source emission inventory model.7These annual vehicle miles travelled (VMT) projections are shown in Appendix A of the Interim and Proposed Technical Support Document and include a projection of vehicle survival fractions that are based on scrappage rates. The lifetime mileage estimates that we used in our analysis are shown in Table 2 below. The Interim and Proposed Technical Support Document contains more information about how we used these mileage estimates. We welcome comments on the lifetime mileage of trucks used in our analysis.

7Information regarding the MOVES model can be found athttp://www.epa.gov/otaq/models/moves/index.htm.

Finally, our methodology for calculating the cost of changes in fuel and DEF consumption uses estimates of average miles driven per gallon of fuel used. The estimates used in this proposal are 9.71 and 4.93 miles per gallon (mpg) for medium and heavy-heavy duty, respectively.8We used these same estimates for both the COC50and COC90analyses. Using different estimates could significantly change the projected costs. We request comment on these mpg estimates.

All of the compliance costs in this analysis are presented in terms of net present value (NPV) for calendar year 2012. This means that costs that occur before 2012 are adjusted upward, and costs that occur after 2012 are adjusted downward to reflect the time or opportunity value of the money involved. (i.e.,discounted).

The NPV analysis requires that all in-use operating costs be adjusted downward to reflect the time value of money for future costs. More specifically, the stream of operating costs must be discounted to make them equivalent to costs incurred at the time of purchase. Truck purchasers would use this approach before purchase when comparing future operating costs of two or more engines before purchase. We used a seven percent discount rate for these costs as well. However, there is evidence in other contexts that users might apply a different discount rate than seven percent when considering future operating costs during a purchase decision. We request comment on whether there is evidence to support the application of such an alternative discount rate to operating costs in the various segments of the heavy duty engine market. Your comments in support of an alternative discount rate should include a discussion of the supporting economic and business rationale for the alternative rate.

It is commonly stated that truck purchasers only consider operating costs that will occur in the first five years (or less) of the truck's life. We also request comment on whether we should include discounted costs for all future years. For example, should we limit our consideration of operating costs to only those that will occur within the first five years?

(6) F Factor

The parameter F is defined in the existing regulations as a value from 1.1 to 1.3 that describes the ratio of the 90th percentile marginal cost (MC90) to MC50. For this proposal, we calculated F by first calculating an MC90in the same way that we calculated MC50. We then calculated the value of F that would give these values of MC90, and then set F equal to MC90divided by MC50. This led to F values of 1.48 for medium heavy-duty and 1.23 for heavy heavy-duty. However, since F is capped at 1.3 under the regulations, we were required to set F equal to 1.3 for medium heavy-duty engines. This resulted in a penalty curve that is inverted from the normal shape. For most NCP curves, the slope of the penalty rate is greater for compliance levels less than X than it is for compliance levels greater than X. However for the proposed medium heavy-duty NCP curve, the opposite is true; the slope of the penalty rate is less for compliance levels less than X than it is for compliance levels greater than X. We request comment on whether this should be allowed. More specifically, should we modify the regulations to specify that the product of MC50and F cannot be less than COC90divided by the difference between the upper limit and the standard. In the case of the proposed NCPs, this would mean setting F at 1.48 for medium heavy-duty.

(7) First Year of the Escalator Adjustment Factor for NCP Calculation

As required by the Clean Air Act, the existing regulations include a formula that increases the penalty rates with each new model year. We have proposed to apply this formula to the NCPs beginning with the 2013 model year by setting the 2012 model year as year number one. Traditionally, NCPs are available the first year of the new emission standard and that becomes year one for purposes of the annual escalator. However, due to the availability of emission credits for 2010 and 2011, it did not become apparent that there might be a manufacturer who might need NCPs until late in the 2011 model year. Under these circumstances, EPA believes the 2012 model year is the correct year for the first year of the escalator calculation even though the NOXemission standard began in 2010. However, there may be reasons to consider model year 2010 or some other model year as the first year for this annual escalator. We welcome comments on alternative first year model years.

(8) Alternative Penalties

Historically, NCPs are defined solely in terms of a dollar amount, with payment of the NCP in the form of cash payments paid directly to the U.S. Treasury. We are asking for comment on whether we could or should also include a non-monetary value as an option in the definition of the noncompliance penalty. For example, assume a manufacturer's penalty would be $1,919 per engine for 10,000 engines ($19,190,000 total), based on certification of engines to an FEL of 0.50 g/bhp-hr, 0.30 g/bhp-hr above the standard. Should there be an option where the penalty could be defined as the amount of NOXemission reductions that would not be achieved by the engine compared to the applicable standard? Achieving these reductions would then be the payment of the NCP as defined under this option. The Agency is considering including this option in the Final Rule as a way to recover the environmental loss due to the higher emissions of the NCP engines.

One example of such an approach would be to require a manufacturer to comply with all of the provisions of the NCP regulations but to define the penalty that must be paid in terms of recouping environmental loss of a defined amount of tons of NOXreduction, rather than a penalty that must be paid in terms of a cash payment. The manufacturer would need to:

• Calculate the total excess NOXemissions expected from the NCP engines over their lifetimes, including emissions that would occur beyond the useful life period. This calculation would be done consistent with the analyses described in the Interim and Proposed Technical Support Document for this rulemaking.

• Develop a plan to offset these NOXtons. The plan must demonstrate that the emissions reduction would not have otherwise occurred.

• Obtain EPA approval of the plan prior to production of the NCP engines.

• Demonstrate to EPA that the emission reductions actually occur.

• Demonstrate that the cost to the manufacturer of achieving the emissions reductions is at least as great as the dollar amount of the NCP that would otherwise be applicable.

The certificate issued for such engines would be conditioned on the manufacturer fulfilling all of these requirements. We could void a certificateab initioif a manufacturer failed to fulfill these requirements.

We welcome comment on any legal, practical, competitive, or other concerns regarding using such an approach and how such an approach could be implemented in the regulations. Commenters supporting this option should address how to determine the equivalent amount of NOXreductions. Based on uncertainty in determining actual tons of NOXthat are reduced, should they be set slightly above the excess tons of expected lifetime NOXemissions that will occur from the engines certified using NCPs? We believe that, in order to meet the statutory requirement to remove the competitive disadvantage for complying manufacturers, it would be necessary to require that the burden associated with providing NOXtons must be at least as large as the cash payment that would otherwise be required. Thus we would not approve an alternative in which itwas cheaper for a manufacturer to obtain NOXtons than to pay the cash penalty, unless the manufacturer could demonstrate that there was some other non-financial burden that offset any competitive advantage.

V. Economic Impact

Because the use of NCPs is optional, manufacturers have the flexibility and will likely choose whether or not to use NCPs based on their ability to comply with emissions standards. If no manufacturer elects to use NCPs, these manufacturers and the users of their products will not incur any additional costs related to NCPs. NCPs remedy the potential problem of having a manufacturer forced out of the marketplace due to that manufacturer's inability to conform to new, strict emission standards in a timely manner. Without NCPs, a manufacturer which has difficulty certifying HDEs in conformance with emission standards or whose engines fail a Selective Enforcement Audit (SEA) has only two alternatives: fix the nonconforming engines, perhaps at a prohibitive cost, or prevent their introduction into commerce. The availability of NCPs provides manufacturers with a third alternative: continue production and introduce into commerce upon payment of a penalty an engine that exceeds the standard until an emission conformance technique is developed. Therefore, NCPs represent a regulatory mechanism that allows affected manufacturers to have increased flexibility. A decision to use NCPs may be a manufacturer's only way to continue to introduce its products into commerce.

VI. Environmental Impact

When evaluating the environmental impact of this rule, one must keep in mind that, under the Act, NCPs are a consequence of enacting new, more stringent emissions requirements for heavy duty engines. Emission standards are set at a level that most, but not necessarily all, manufacturers can achieve by the model year in which the standard becomes effective. Following International Harvester v. Ruckelshaus, 478 F. 2d 615 (DC Cir. 1973), Congress realized the dilemma that technology-forcing standards could potentially cause, and allowed manufacturers of heavy-duty engines to certify nonconforming vehicles/engines upon the payment of an NCP, under certain terms and conditions. This mechanism was intended to allow manufacturer(s) who cannot meet technology-forcing standards immediately to continue to manufacture nonconforming engines while they tackle the technological problems associated with meeting new emission standard(s). Thus, as part of the statutory structure to force technological improvements without driving manufacturers or individual engine models out of the market, NCPs provide a flexibility that fosters long-term emissions improvement through the setting of lower emission standards at an earlier date than could otherwise be feasible. Because NCPs are designed to increase with time, manufacturers using NCPs are likely to reduce emission levels to meet the standard as quickly as possible, which minimizes the environmental impact.

As is always the case with NCPs, the potential exists for there to be more extensive use of NCPs beyond what may be expected to be used by the manufacturer that we believe will need them. For example, depending upon the penalty rate and other factors, some otherwise fully compliant manufacturers could elect to pay the NCP in order to reconfigure their 0.20 g/hp-hr NOXcompliant engines to emit up to 0.50 g/hp-hr so that they can re-optimize engine hardware and vehicle operating costs. This potential action is not without R&D and other financial costs to the manufacturer and thus is not a decision which would be taken lightly, given the short-term nature of the NCPs allowed for in this interim final rule. Furthermore, we believe that any such impacts would be short-term and self-limiting in nature because the NCP annual adjustment factor, established via prior NCP rules, increases the levels of the penalties over time and based on the extent of the use of NCPs by all manufacturers. In other words the NCP program is structured such that the incentives to produce engines that meet the standard increase year-by-year and increase upon NCP use. The practical impact of this adjustment factor is that the NCPs will rapidly become an undesirable option for all manufacturers that may elect to use them. However, while we expect their use to be limited, we have no way of predicting at this time how many manufacturers will make use of the NCPs, or how many engine families would be subject to the NCP program. Because of these uncertainties we are unable to accurately quantify the potential impact the NCPs might have on emission inventories, although, as stated above, any impacts are expected to be short-term and self-limiting in nature.

VII. Public Participation

We request comment by April 4, 2012.on all aspects of this proposal. This section describes how you can participate in this process.

A. How do I submit comments?

We are opening a formal comment period by publishing this document. We will accept comments through April 4, 2012. If you have an interest in the program described in this document, we encourage you to comment on any aspect of this rulemaking. We request comment on various topics throughout this proposal.

Your comments will be most useful if you include appropriate and detailed supporting rationale, data, and analysis. If you disagree with parts of the proposed program, we encourage you to suggest and analyze alternate approaches to meeting the goals described in this proposal. You should send all comments, except those containing proprietary information, to our Air Docket (seeADDRESSES) before the end of the comment period.

If you submit proprietary information for our consideration, you should clearly separate it from other comments by labeling it “Confidential Business Information.” You should also send it directly to the contact person listed underFOR FURTHER INFORMATION CONTACTinstead of the public docket. This will help ensure that no one inadvertently places proprietary information in the docket. If you want us to use your confidential information as part of the basis for the final rule, you should send a non-confidential version of the document summarizing the key data or information. We will disclose information covered by a claim of confidentiality only through the application of procedures described in 40 CFR part 2. If you do not identify information as confidential when we receive it, we may make it available to the public without notifying you.

B. Will there be a public hearing?

We will hold a public hearing at the National Vehicle and Fuels Emission Laboratory in Ann Arbor, Michigan on March 5, 2012. The hearings will start at 10:00 am and continue until everyone has had a chance to speak.

If you would like to present testimony at a public hearing, we ask that you notify the contact person listed above at least ten days before the hearing. You should estimate the time you will need for your presentation and identify any needed audio/visual equipment. We suggest that you bring copies of your statement or other material for the EPA panel and the audience. It would also be helpful if you send us a copy of your statement or other materials before the hearing.

We will make a tentative schedule for the order of testimony based on the notifications we receive. This schedule will be available on the morning of the hearing. In addition, we will reserve a block of time for anyone else in the audience who wants to give testimony. We will conduct the hearing informally, and technical rules of evidence won't apply. We will arrange for a written transcript of the hearing and keep the official record of the hearing open for 30 days to allow you to submit supplementary information. You may make arrangements for copies of the transcript directly with the court reporter.

VIII. Statutory and Executive Order ReviewsA. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review

This action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

B. Paperwork Reduction Act

This action does not impose any new information collection burden. It only updates the penalty amounts to correspond to the current emission standards. However, the Office of Management and Budget (OMB) has previously approved the information collection requirements contained in the existing regulations 40 CFR part 86, subpart L under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501et seq.and has assigned OMB control number 2060-0132. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act(1) Overview

The Regulatory Flexibility Act generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.

For purposes of assessing the impacts of these rules on small entities, small entity is defined as: (1) A small business as defined by SBA regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

(2) Summary of Potentially Affected Small Entities

After considering the economic impacts of this proposed rule on small entities, I certify that this action will not have a significant impact on a substantial number of small entities.

When these emission standards were established, the final rulemaking (66 FR 5001, January 18, 2001) noted that we were not aware of “any manufacturers of heavy-duty engines that meet SBA's definition of a small business.” Based on an updated assessment, EPA has identified a total of about 14 manufacturers that produce diesel cycle heavy-duty motor vehicle engines. Of these, none of these are small businesses that are producing engines with NOXemissions above 0.20 g/hp-hr. Based on this, we are certifying that this proposed rule will not have a significant economic impact on a substantial number of small entities.

(3) Conclusions

I therefore certify that this proposal will not have a significant economic impact on a substantial number of small entities. We continue to be interested in the potential impacts of the proposed rule on small entities and welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

This rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. The agency has determined that this action does not contain a Federal mandate that may result in expenditures of $100 million or more for the private sector in any one year. Because the use of NCPs is optional, manufacturers have the flexibility and will likely choose whether or not to use NCPs based on their ability to comply with emissions standards. The availability of NCPs provides manufacturers with a third alternative: to continue production and introduce into commerce upon payment of a penalty an engine that exceeds the standard until an emission conformance technique is developed. Therefore, NCPs represent a regulatory mechanism that allows affected manufacturers to have increased flexibility. Thus, this action is not subject to the requirements of sections 202 or 205 of the UMRA. This action is also not subject to the requirements of section 203 of the UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.

E. Executive Order 13132 (Federalism)

Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.”

This proposed action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. These proposed rules will apply to manufacturers of on-highway engines and not to state or local governments. Thus, Executive Order 13132 does not apply to this action.

In the spirit of Executive Order 13132, and consistent with EPA policy to promote communications between the agency and State and local governments, the agency specifically solicits comment on this proposed action from State and local officials.

F. Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments)

This proposed rule does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). This proposal will be implemented at the Federal level and impose compliance costs only on engine manufacturers who elect to use the NCP regulatory flexibility to comply with emissions standards. Tribal governments would be affected only to the extent they purchase and use engines and vehicles to which an NCP has been applied. Thus, Executive Order 13175 does not apply to this proposed rule.

G. Executive Order 13045: “Protection of Children From Environmental Health Risks and Safety Risks”

Executive Order 13045: “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997) applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the agency.

EPA interprets Executive Order 13045 as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Order has the potential to influence the regulation. This proposed rule is not subject to Executive Order 13045 because it does not establish an environmental standard intended to mitigate health or safety risks.

H. Executive Order 13211 (Energy Effects)

This proposed action is not subject to Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, 12(d) (15 U.S.C. 272 note) directs the agencies to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g.,materials, specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the EPA decides not to use available and applicable voluntary consensus standards.

This proposed rulemaking does not involve technical standards. Therefore, EPA is not considering the use of any voluntary consensus standards.

Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA has determined that this action will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations. The overall environmental impacts of this action are expected to be small and of limited duration. Moreover, there is no reason to believe that trucks using NCP engines will be more likely to operate near any minority or low-income populations than other trucks.

IX. Statutory Provisions and Legal Authority

Statutory authority for the vehicle controls in these rules is found in CAA section 206(g) of the CAA, 42 U.S.C. 7525(g).

For the reasons set forth in the preamble, the Environmental Protection Agency proposes to amend 40 CFR chapter I of the Code of Federal Regulations as follows:

PART 86—CONTROL OF EMISSIONS FROM NEW AND IN-USE HIGHWAY VEHICLES AND ENGINES

1. The authority citation for part 86 continues to read as follows:

Authority:

42 U.S.C. 7401-7671q.

Subpart L—[Amended]

2. Section 86.1104-91 is revised to read as follows:

§ 86.1104-91Determination of upper limits.

EPA shall set a separate upper limit for each phase of NCPs and for each service class.

(a) The provisions of this section specify a default approach for determining the upper limit values.

(1) The default upper limit applicable to a pollutant emission standard for a subclass of heavy-duty engines or heavy-duty vehicles for which an NCP is established in accordance with § 86.1103-87, shall be the previous pollutant emission standard for that subclass.

(2) If a manufacturer participates in any of the emissions averaging, trading, or banking programs, and carries over certification of an engine family from the prior model year, the upper limit for that engine family shall be the family emission limit of the prior model year, unless the family emission limit is less than the upper limit determined in paragraph (a) of this section.

(b) If no previous standard existed for the pollutant under paragraph (a) of this section, the upper limit will be developed by EPA during rulemaking.

(c) EPA may set the upper limit during rulemaking at a level below the default level specified in paragraph (a) of this section if we determine that a lower level is achievable by all engines.

(d) In unusual circumstances, EPA may set the upper limit during rulemaking at a level above the default level specified in paragraph (a) of this section if we determine that the default level will not be achievable by all engines. For example, this may apply where a new standard for a different pollutant effectively increases the stringency of the standard for which NCPs would apply.

3. Section 86.1105-87 is amended by revising paragraph (e) and paragraph (j) to read as follows:

§ 86.1105-87Emission standards for which nonconformance penalties are available.

(e) The values of COC50, COC90, and MC50in paragraphs (a) and (b) of this section are expressed in December 1984 dollars. The values of COC50, COC90, and MC50in paragraphs (c) and (d) of this section are expressed in December 1989 dollars. The values of COC50, COC90, and MC50in paragraph (f) of this section are expressed in December 1991 dollars. The values of COC50, COC90, and MC50in paragraphs (g) and (h) of this section are expressed in December 1994 dollars. The values of COC50, COC90, and MC50in paragraph (i) of this section are expressed in December 2001dollars. The values of COC50, COC90, and MC50in paragraph (j) of this section are expressed in December 2011 dollars. These values shall be adjusted for inflation to dollars as of January of the calendar year preceding the model year in which the NCP is first available by using the change in the overall Consumer Price Index, and rounded to the nearest whole dollar in accordance with ASTM E29-67 (reapproved 1980), Standard Recommended Practice for Indicating Which Places of Figures are to be Considered Significant in Specified Limiting Values. This method was approved by the Director of theFederal Registerin accordance with 5 U.S.C. 552(a) and 1 CFR part 51. This document is available from ASTM International, 100 Barr Harbor Drive, P.O. Box C700, West Conshohocken, PA 19428-2959, and is also available for inspection as part of Docket A-91-06, located at the U.S. EPA, Air and Radiation Docket and Information Center, 1301 Constitution Ave. NW., Room 3334, EPA West Building, Washington, DC 20004, (202) 202-1744 or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to:http://www.archives.gov/federal-register/cfr/ibr-locations.html.This incorporation by reference was approved by the Director of theFederal Registeron January 13, 1992. These materials are incorporated as they exist on the date of the approval and a notice of any change in these materials will be published in theFederal Register.

(j) Effective in the 2012 and later model years, NCPs will be available for the following emission standard:

The Legal Services Corporation (LSC) Act (the Act) provides general authority to the Corporation “to insure the compliance of recipients and their employees with the provisions of [the Act] and the rules, regulations, and guidelines promulgated pursuant to [the Act].”1LSC's principal regulation discussing general enforcement authority and procedures is the Enforcement Procedures regulation at 45 CFR part 1618. In accordance with the requirements of part 1618, LSC uses a variety of enforcement tools, formal and informal, to ensure compliance. Among these are informal consultations and compliance training, on-site Case Service Report/Case Management System reviews, the imposition of Required Corrective Actions (RCAs), and the imposition of Special Grant Conditions (SGCs) at the beginning of a grant year. Several additional enforcement tools are provided for in LSC-adopted regulations and are available to the Corporation to address significant non-compliance by a recipient. In particular, LSC has adopted suspension procedures (45 CFR part 1623) and questioned-cost procedures (45 CFR part 1630). LSC has also adopted grant termination procedures (45 CFR part 1606) that provide for the termination of funding in whole or part in cases of a recipient's substantial noncompliance with LSC statutory or regulatory requirements and other policies, instructions, or grant terms and conditions. Under the grant-termination provisions, a reduction of five percent or more of a recipient's funding is considered a termination and can be implemented only in compliance with the termination procedures.2Reductions of funding of less than five percent are not considered terminations. In order to reduce a recipient's funding by less than five percent without using the 1606 termination procedures, additional procedures have to be established by rulemaking.3LSC has not yet adopted regulations establishing such standards and procedures. LSC also has the authority under Part 1606 to debar recipients from eligibility to receive future grants.

1LSC Act, section 2996e(b)(1)(A); 42 U.S.C. 1006(b)(1)(A).

245 CFR 1606.2(d).

345 CFR 1606.2(d)(2)(v).

The majority of LSC recipients are in substantial compliance with LSC requirements most of the time. When non-compliance occurs, recipients almost always work diligently and cooperatively with LSC staff to come promptly into compliance, but there have been exceptions. LSC is now considering adding enforcement tools to increase LSC's flexibility in addressing compliance issues.

LSC's consideration of the adoption of additional enforcement tools responds to concerns expressed by the Government Accountability Office(GAO) in its report,Legal Services Corporation: Improved internal controls needed in grants management and oversight,GAO-08-37 (December 2007). In that report, the GAO noted that LSC has “limited options for sanctioning or replacing poor-performing recipients.” GAO-08-37 at 17. Indeed, as discussed at further length below, the existing enforcement mechanisms available to LSC are best suited to situations involving numerous and/or very significant violations, or to situations in which compliance issues are technical or minor. Consequently, several of LSC's most potent existing enforcement mechanisms are not practicable in most instances and are therefore rarely used. Other, less onerous mechanisms are more practicable, but are largely dependent on the recipient's cooperation. LSC does not have enforcement mechanisms well suited to violations or compliance issues in an intermediate range—material but not extreme, or multiple but not profuse, in situations where a recipient does not voluntarily take corrective action in a timely manner.

Existing Enforcement Mechanisms

LSC relies primarily on RCAs to remedy compliance problems. The LSC Office of Compliance and Enforcement (OCE) estimates that in approximately 90 percent of cases in which RCAs are imposed, recipients implement the RCAs on a timely and satisfactory basis. In approximately ten percent of the cases, however, a recipient fails to implement the required corrective actions in a timely or satisfactory manner.

In some instances in which recipients have failed to implement RCAs in a timely or satisfactory manner, LSC has imposed SGCs. Although SGCs may be substantively identical to the measures contained in RCAs, SGCs elevate the matter by formally incorporating the conditions into the recipient's grant documents and ensure that the recipient's Board Chair, who has to sign the SGCs, is aware of an ongoing problem. Although LSC has had some success with SGCs, LSC has also encountered instances in which a recipient that has failed to comply with an RCA has also failed to comply with an SGC. Moreover, SGCs have thus far only been imposed at the beginning of a grant year, impacting their availability and utility depending on the timing of a particular compliance situation.

In recent years, LSC has increasingly used short-term funding, that is, providing a grant for less than a year (e.g., month-to-month), to encourage compliance. But short-term funding can be invoked only when a recipient is at the end of a grant term and competing for a new grant. Short-term funding can be destabilizing for a recipient, particularly if the recipient does not have significant non-LSC funding sources. Thus, although short-term funding can be a powerful enforcement mechanism, it is likely to be used only in limited situations.

Suspension of funding is another existing enforcement mechanism of limited utility. Suspension of funding is most effective to get a recipient to perform a specific action in a discrete period of time, such as providing access to records or adopting a new policy or procedure. Because suspension of funding can have significant effects on client service, it is generally not appropriate when the violation at issue cannot be “remedied” by future action (for example, the representation of an ineligible client in a closed matter cannot be “undone”). Even when suspension might be an appropriate tool, the current regulations cap the suspension period at 30 days, except for violations involving failure to provide the Office of Inspector General with an acceptable audit. In situations where LSC might otherwise have considered imposing a suspension, LSC has determined that the resources required to pursue the suspension process would not be well invested given that, under the current regulations, any funds withheld would have to be released to the recipient at the end of the 30-day suspension period, regardless of whether the violation had been remedied.

LSC has rarely invoked its most serious enforcement tools, termination and debarment. There are several reasons for this. First, in most instances termination and debarment are not warranted. But even in situations where such sanctions might be warranted, these tools are rarely used because of the protracted process and the extensive resources, both for LSC and the recipient, that these sanctions entail. In addition, LSC must carefully consider the disruption that termination would cause to client service in the recipient's service area, particularly because a number of recipients have statewide service areas. Finding new providers is a significant challenge and serves as a disincentive for the Corporation to eliminate or disqualify existing grantees except under the most extreme circumstances.

The practical limitations on the suspension, termination, and debarment remedies have other important implications. Some violations are serious and significant even if the recipient takes timely steps to ensure that the violations do not recur. In these situations, imposition of suspension, termination, or debarment may not be appropriate, but the imposition of a RCA may result in a perception that the recipient “got away with” the violation without a commensurate penalty.

In light of its experience with the existing enforcement mechanisms, LSC is proposing to amend its regulations at 45 CFR parts 1606, 1618, and 1623 to adopt standards and procedures for limited reductions in funding, to allow for the imposition of SGCs during a grant year, and to amend the maximum suspension period from 30 to 90 days. The proposed changes are discussed in greater detail below.

Amending Part 1606 To Include Standards and Procedures for Limited Reductions in Funding

The adoption of standards for a reduction in funding of less than five percent would provide LSC with additional flexibility in fashioning appropriate enforcement responses and obtaining recipient compliance. And when a reduction in funding of less than five percent is proposed, LSC should be able to use a less cumbersome process than the existing termination process, which applies to any funding reduction of five percent of more. In a few cases, a recipient has violated restrictions but a 1606 termination would have been excessive, and LSC has been without an available sanction commensurate with the nature of the violation. Recovery of expended funds through a questioned-cost proceeding, although a necessary and useful mechanism to ensure that recipient funds are used only as permitted, is in the nature of restitution and serves an essentially different purpose than a sanction such as a limited reduction in funding. Moreover, the amount of funds improperly expended may bear no relation to the seriousness of the violation and simply recovering them may, therefore, not be a remedy commensurate with the violation. In such cases, an intermediate sanction, such as a limited reduction in funding, could provide LSC with a meaningful and appropriate sanction to use to address the infraction. The option to impose a reduction in funding of less than five percent would also reduce the risk that a recipient's client services or ability to implement corrective action would suffer due to a significant lack of resources.

Accordingly, LSC is proposing to add a new section to Part 1606 to implement procedures for the reduction of a recipient's funding in an amount less than five percent of the recipient'scurrent annual level of financial assistance. The proposed procedure is modeled on the suspension procedure in Part 1623, because those procedures provide a significant opportunity for recipient input and due process without being unduly complex.

Authority and Responsibility

The proposed § 1606.15(a)4is an introductory paragraph setting forth a statement of LSC's authority to impose limited reductions in funding and LSC's responsibility to follow the procedures and requirements set forth in the section before doing so. LSC believes it is clear from the language of the proposed text that any reduction would be only for the particular grant year in which the reduction of funding is imposed. For example, if a recipient were in the second year of a three-year grant term and LSC imposed a two percent reduction in funding for that grant year, the reduction would affect the recipient's funds for that second year of the grant term only, and there would be no effect on the recipient's level of funding for the third year of the grant term.

4In accordance withFederal Registerrequirements, LSC is not quoting the proposed regulatory text language in this preamble. Readers are referred to the regulatory text sectionsupra.

Grounds and Criteria for Limited Reductions in Funding

Proposed paragraphs (b) and (c) address the permissible grounds and criteria for the imposition of a limited (less than five percent) reduction in funding. The proposed grounds for a limited reduction in funding are the same as those for both terminations and suspensions, although, as explained below, the procedures for a limited reduction would be less onerous. The proposed language also makes clear that the magnitude of a limited reduction in funding in a particular situation (e.g., one percent or three percent) will also be determined with reference to the same criteria. Any limited reduction in funding should be tailored to and commensurate with to the nature of the violation, and the proposed language is intended to reflect this expectation.

The Process for Limited Reductions in Funding

Proposed paragraphs (d) through (g) set forth the process LSC would follow to impose a limited (less than five percent) reduction in funding on a recipient and are based on the process set forth in § 1623.4 of the suspension rule. As noted above, LSC believes that the suspension procedures provide a straightforward procedure with a significant opportunity for recipient input and due process. The provisions guarantee recipients written notice of proposed limited reductions in funding, include an explanation of the basis for the proposed reduction, along with the opportunity to provide a formal, written response. Recipients would also have an opportunity to request an informal, in-person meeting to resolve issues. LSC believes that the proposed procedures provide significant process protections to recipients without being nearly as resource-intensive and time-consuming as the formal hearing process used for terminations, and that the proposed protections are commensurate with the sanction of a funding reduction of less than five percent.

Other Conforming Amendments to Part 1606

LSC is proposing to amend the title of part 1606 to reference limited reductions in funding. Because a limited reduction in funding is not a termination, LSC believes that adding the reference to limited reductions in funding to the title of part 1606 is necessary for accuracy and will assist readers in locating the limited reduction in funding procedures in LSC's regulations. LSC is also proposing amendments to §§ 1606.2, “Definitions,” and 1606.13, “Interim and termination funding; reprogramming,” to harmonize these sections with the proposed new section.

First, LSC is proposing to amend § 1606.2(d)(2)(v), which specifies that a reduction in a recipient's funding of less than five percent is not a termination. That section currently provides that no such reduction shall be imposed except in accordance with regulations promulgated by the Corporation. Because LSC is now proposing to promulgate such regulations, LSC proposes to delete this sentence and substitute a cross-reference to the proposed new § 1606.15.

Second, LSC proposes to amend § 1606.3(b) to make clear that the magnitude of a termination of funding in a particular situation (e.g., five percent or twenty percent or a termination in whole) will be determined with reference to the criteria listed in this section. LSC believes that this expectation in implicit in the current regulation, and that any termination of funding should be tailored to and commensurate with the nature of the violation. LSC believes that the clarifying language reinforces this expectation and should be inserted here to be consistent with the proposed language in proposed new § 1606.15.

Third, LSC proposes to amend paragraphs (a), (b), and (d) of § 1606.13, “Interim and termination funding; reprogramming.”5Section 1606.13 currently addresses issues related to funding during and upon the conclusion of termination procedures and Corporation's use of funds recovered through a termination proceeding. LSC believes these provisions should be equally applicable in cases involving a limited reduction in funding. Accordingly, LSC proposes to amend paragraphs (a), (b), and (d) of § 1606.13 to include references to limited reduction in funding procedures pursuant to § 1606.15.

5Amendment of paragraph (c) is not necessary because that paragraph addresses close-out funding, which applies only to circumstances involving a termination in whole.

With respect to proposed paragraph (d), LSC is also proposing a substantive change. The current provision reflects the Corporation's longstanding policy that recovered funds are generally to be used in the service area which the funds originally supported, unless the Corporation exercises its discretion to reallocate the funds for some other basic field purpose, such as for making emergency or other special grants. Although this policy is appropriate in many cases involving recovered funds, in the case of limited reductions in funding and terminations, especially terminations in part, the funds are being recovered as a sanction against the recipient. As most service areas only have one recipient operating within them, a presumption or expectation that funds be returned to the same service area would imply a presumption toward or expectation of returning funds to the very recipient from which they had been taken as a sanction. It is highly likely that in such cases LSC would choose to exercise its discretion to reallocate the funds, so as to avoid returning the funds to the recipient from which they had been taken.6It is therefore more appropriate for this section not to reflect any presumption or expectation and, instead, simply to give the Corporation discretion to reallocate the funds for basic field purposes.

6It is more likely that in the case of a termination in whole that the Corporation would choose to exercise its discretion to return the recovered funds to the original service area to fund services by an interim or new recipient. In such a case, however, LSC would presumably be providing the funds to an entity other than the terminated recipient.

Amending Part 1618 To Permit the Imposition of Special Grant Conditions During a Grant Year

LSC's current standard grant assurances (applicable to all recipients)provide that SGCs may be imposed on a recipient prior to the awarding of a new grant or at the beginning of a new year of a multi-year grant term. The Corporation's experience has been that imposing SGCs is a particularly effective way of capturing a recipient's attention and securing compliance with LSC requirements. LSC believes it would be helpful to be able to impose SGCs on a recipient during the course of a grant year when a recipient has been found to be in violation of an applicable requirement. Such authority would make SGCs available whenever they might be necessary, rather than only at the beginning of a grant year, which may or may not correspond to the timing of the matter occasioning the SGC. Although this is an action LSC might be able to take without rulemaking, LSC is invoking the rulemaking process to provide an opportunity for public comment on this proposal.

Accordingly, LSC proposes to amend 45 CFR 1618.5 to add language providing that whenever there is substantial reason to believe that a recipient has persistently or intentionally violated the Act, or, after notice, has failed to take the appropriate remedial or disciplinary action to ensure compliance by its employees with the Act, and attempts at informal resolution have been unsuccessful, the Corporation may impose SGCs on the recipient during the grant year.

Amending Part 1623 To Increase Maximum Period of Suspension of Funding Pending Corrective Action

LSC is proposing to change the current maximum suspension limitation from 30 days to 90 days. Although section 1011(2) of the LSC Act provides that a suspension of financial assistance shall not be continued for longer than 30 days unless the recipient has been afforded reasonable notice and opportunity for a timely, full, and fair hearing conducted, when requested, by an independent hearing examiner, section 501(b) of LSC's FY 1998 appropriation legislation (which has been carried forth in each subsequent appropriation) expressly renders that provision inoperative. LSC is thus within its current statutory authority to increase the maximum suspension period through regulatory action. (Although it may appear irregular to adopt a regulation implementing a provision of law appearing in an appropriations act which, by its terms, is time-limited, there is ample precedent for this in the LSC context. LSC's authorizing legislation has not been amended since 1977, and since 1996 a significant number of substantive restrictions and provisions superseding those in the LSC Act have been contained on a recurring basis in LSC's annual appropriations legislation. In order to comply with these provisions in a practical manner, LSC has adopted implementing regulations. This was the case with 1998 amendments to the suspension rule that LSC now proposes to further amend. See 63 FR 64646 (November 23, 1998).) As with limited reductions in funding, LSC believes that a longer potential maximum suspension period can be a useful option because of its expected deterrent effect (thereby enhancing the efficacy of non-monetary enforcement mechanisms) and as a meaningful enforcement tool in itself in the infrequent situations in which it would be needed.

The preamble to the current version of part 1606 explains that the 30-day limit was chosen to:

Reflect[ ] the presumption that a suspension of too long a duration would likely endanger a recipient's ability to continue service to its clients. A suspension is intended to be used for extraordinary circumstances when prompt intervention is likely to bring about immediate corrective action. The Corporation, therefore, should act quickly to determine that the problem is solved and is unlikely to reoccur, the appropriate corrective action has been taken, or initiate a termination process under part 1606.

63 FR 64646 at 64648 (Nov. 23, 1998). However, although the Corporation originally anticipated that proceeding to termination if a 30-day suspension was not successful in obtaining corrective action would be a practicable option, in practice that has not turned out to be the case (for the reasons discussed above). In addition because of the short duration of the current maximum suspension period, LSC has rarely actually imposed a suspension.7Having the option of a longer term would make suspension a more practical option, and a 90-day cap would mitigate the concern about the potential effects of “a suspension of too long a duration” on client service expressed in the preamble quoted above. For example, a more practical suspension option would have been useful in a few situations in which recipients refused to provide LSC access to certain records. LSC believes that having had a more credible suspension option may have provided an incentive to those recipients to be more cooperative in producing these records.

7The exception to this is in cases involving a recipient's failure to provide the Office of Inspector General with an acceptable audit. However, in these cases, the suspension term runs, as required by statute, until an audit is completed.

LSC anticipates that the maximum 90-day suspension would be warranted only in rare cases, and would only seek to apply the minimum suspension period it believes would be necessary to result in the required corrective action being taken. Moreover, a recipient facing or subject to a suspension can forestall implementation or shorten the length of a suspension by taking the necessary actions to come into compliance. As is currently the case, full funding would be restored upon the timely and satisfactory implementation of all required corrective actions, or earlier at LSC's discretion if circumstances warranted (such as if the recipient were making regular and reasonable progress toward the implementation of corrective actions, even if not all actions had been completed, and if LSC determined that lifting the suspension was appropriate). Thus, although extending the maximum suspension period is an option with potentially significant consequences, LSC believes that the due process procedures that apply to the suspension process, combined with the fact that the recipient can take action that will terminate the suspension, provide adequate protection to recipients. LSC is of the opinion, however, that in situations where a suspension of longer than 90 days might be warranted, LSC other available sanctions (such as a reduction in funding as proposed herein or termination) would likely be as or more effective. LSC notes that Federal grant-making agencies are not limited to applying suspensions of funding to any particular maximum day limit.

For reasons set forth above, and under the authority of 42 U.S.C. 2996g(e), LSC proposes to amend 45 CFR chapter XVI as follows:

PART 1606—TERMINATION, LIMITED REDUCTION IN FUNDING, AND DEBARMENT PROCEDURES; RECOMPETITION

(c)Limited reduction in fundingmeans a reduction in funding of less than 5 percent of a recipient's current annual level of financial assistance imposed by the Corporation in accordance with § 1606.15 of this Part.

(e)(1)Terminationmeans that a recipient's level of financial assistance under its grant or contract with the Corporation will be reduced in whole or in part prior to the expiration of the term of a recipient's current grant or contract. A partial termination will affect only the recipient's current year's funding, unless the Corporation provides otherwise in the final termination decision.

(2) A termination does not include:

(i) A reduction of funding required by law, including a reduction in or rescission of the Corporation's appropriation that is apportioned among all recipients of the same class in proportion to their current level of funding;

(ii) A reduction or deduction of LSC support for a recipient under the Corporation's fund balance regulation at 45 CFR part 1628;

(iii) A recovery of disallowed costs under the Corporation's regulation on costs standards and procedures at 45 CFR part 1630;

(iv) A withholding of funds pursuant to the Corporation's Private Attorney Involvement rule at 45 CFR part 1614; or

(b) A determination of whether there has been a substantial violation for the purposes of paragraph (a)(1) of this section, and the magnitude of any termination in whole or in part, will be based on consideration of the following criteria:

(a) Pending the completion of termination or limited reduction in funding proceedings under this part, the Corporation shall provide the recipient with the level of financial assistance provided for under its current grant or contract with the Corporation.

(b) After a final decision has been made to terminate a recipient's grant or contract or to impose a limited reduction in funding, the recipient loses all rights to the terminated or reduced funds.

(d) Funds recovered by the Corporation pursuant to a termination or limited reduction in funding shall be reallocated by the Corporation for basic field purposes at its sole discretion.

6. Add a § 1606.15 to read as follows:

§ 1606.15Limited reductions of funding.

(a) The Corporation may, in accordance with the procedures and requirements set forth in this section, impose a limited reduction of funding by reducing a recipient's funding in an amount less than 5% of the recipient's current annual level of financial assistance.

(b) Grounds for limited reduction in funding. A limited reduction of funding may be imposed when the Corporation determines that termination in whole or in part of the recipient's grant is not warranted, but that there nevertheless has been a substantial violation by the recipient of an applicable provision of law, or a rule, regulation, guideline or instruction issued by the Corporation, or a term or condition of the recipient's current grant or contract with the Corporation.

(c) A determination whether there has been a substantial violation for the purposes of paragraph (b) of this section, and the magnitude of the limited reduction in funding, will be based on consideration of the criteria set forth in § 1606.3(b).

(d) When the Corporation has made a determination to impose a limited reduction in funding in accordance with this section, the Corporation shall provide a written determination to the recipient and the Chair of the recipient's governing body. The determination shall:

(1) State the grounds, the amount, and the effective date for the limited reduction in funding;

(2) Identify, with reasonable specificity, any facts or documents relied on as justification for the limited reduction in funding;

(3) Specify what, if any, corrective action the recipient can take to avoid the limited reduction in funding;

(4) Advise the recipient that it may request, within five business days of receipt of the determination, an informal meeting with the Corporation at which it may attempt to show that the limited reduction in funding should not be imposed; and

(5) Advise the recipient that, within 10 days of its receipt of the determination and without regard to whether it requests an informal meeting, it may submit written materials in opposition to the limited reduction in funding.

(e) If the recipient requests an informal meeting with the Corporation, the Corporation shall designate the time and place for the meeting. The meeting shall occur within five business days after the recipient's request is received.

(f) If the recipient neither requests an informal meeting nor submits any written materials in opposition to the determination, the determination will be deemed effective at the end of the 10-day period following recipient's receipt of the determination.

(g) If an informal meeting is conducted and/or written materials are submitted by the recipient, the Corporation shall consider any written materials submitted by the recipient in opposition to the limited reduction in funding and any oral presentation or written materials submitted by the recipient at an informal meeting. After considering such materials, the Corporation shall decide within 30 days whether the limited reduction in funding should become effective and shall notify the recipient and the recipient's Board Chair in writing of its decision.

(b) Whenever there is substantial reason to believe that a recipient has persistently or intentionally violated the Act, or, after notice, has failed to take the appropriate remedial or disciplinary action to ensure compliance by its employees with the Act, and attempts at informal resolution have been unsuccessful, the Corporation may proceed to suspend or terminate financial support to the recipient pursuant to the procedures set forth in parts 1623 and 1606, respectively; may impose Special Grant Conditions on the recipient during the grant year; or may take other action to enforce compliance with the Act.

(e) The Corporation may at any time rescind or modify the terms of the final determination to suspend and, on written notice to the recipient, may reinstate the suspension without further proceedings under this part. Except as provided in paragraph (f) of this section, the total time of a suspension shall not exceed 90 days, unless the Corporation and the recipient agree to a continuation of the suspension without further proceedings under this part.

National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

ACTION:

Notice of availability; request for comments.

SUMMARY:

NMFS announces that the South Atlantic Fishery Management Council (Council) has submitted Amendment 18A to the Fishery Management Plan (FMP) for the Snapper-Grouper Fishery of the South Atlantic Region (Amendment 18A) for review, approval, and implementation by NMFS. The amendment proposes actions to update the current rebuilding strategy for black sea bass, modify the current system of accountability measures for black sea bass, limit effort in the black sea bass component of the snapper-grouper fishery, and improve fisheries data reporting in the for-hire sector of the snapper-grouper fishery.

DATES:

Written comments must be received on or before April 2, 2012.

ADDRESSES:

You may submit comments on the amendment identified by “NOAA-NMFS-2011-0282” by any of the following methods:

Instructions:All comments received are a part of the public record and will generally be posted tohttp://www.regulations.govwithout change. All Personal Identifying Information (for example, name, address, etc.) voluntarily submitted by the commenter may be publicly accessible. Do not submit Confidential Business Information or otherwise sensitive or protected information.

To submit comments through the Federal e-Rulemaking Portal:http://www.regulations.gov,click on “submit a comment,” then enter “NOAA-NMFS-2011-0282” in the keyword search and click on “search”. To view posted comments during the comment period, enter “NOAA-NMFS-2011-0282” in the keyword search and click on “search”. NMFS will accept anonymous comments (enter N/A in the required field if you wish to remain anonymous). You may submit attachments to electronic comments in Microsoft Word, Excel, WordPerfect, or Adobe PDF file formats only.

Comments received through means not specified in this rule will not be considered.

Electronic copies of Amendment 18A may be obtained from the Southeast Regional Office Web site athttp://sero.nmfs.noaa.gov.Amendment 18A includes an Environmental Impact Statement, an Initial Regulatory Flexibility Analysis, a Regulatory Impact Review, and a Fishery Impact Statement.

The Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) requires each regional fishery management council to submit any fishery management plan or amendment to NMFS for review and approval, partial approval, or disapproval. The Magnuson-Stevens Act also requires that NMFS, upon receiving a plan or amendment, publish an announcement in theFederal Registernotifying the public that the plan or amendment is available for review and comment.

The South Atlantic snapper-grouper fishery is managed under the FMP. The FMP was prepared by the Council and implemented by NMFS under the authority of the Magnuson-Stevens Act by regulations at 50 CFR part 622.

Background

The primary purpose of Amendment 18A is to address derby fishing conditions in the black sea bass component of the snapper-grouper fishery by reducing effort in the fishery and reducing the rate of harvest to optimize use of the resource among fishery participants. Amendment 18A would also implement measures to update the current rebuilding strategy for black sea bass in response to the outcome a new stock assessment for the species, and improve data reporting in the for-hire sector of the snapper-grouper fishery.

Targeting of black sea bass has increased as restrictions are placed on other species, and black sea bass has been in a constant catch rebuilding plan since 2006, where the allowable catch is held steady as the stock rebuilds. Furthermore, as black sea bass rebuilds and the population size becomes larger, fish are being harvested at a faster rate. Due to these circumstances, the commercial and recreational annual catch limits (ACLs) have been met before the end of the fishing year for the past 3 fishing years, and the ACL closures have occurred earlier in each consecutive fishing year. In an effort to extend fishing opportunities further into the fishing season, the Council has approved several actions intended to reduce effort and the rate of harvest in the black sea bass segment of the snapper-grouper fishery.

To reduce effort in the commercial sector for black sea bass, Amendment 18A contains an action to establish a black sea bass pot endorsement program. In order to qualify for a black sea bass pot endorsement the following eligibility criteria must be met:

(1) The permit holder must have a South Atlantic Unlimited Snapper-Grouper Permit that is valid (not expired) on the effective date of the final rule implementing Amendment 18A, if approved; (2) the South Atlantic Unlimited Snapper-Grouper Permit must have black sea bass landings with pot gear between January 1, 1999, and December 31, 2010, of at least 2,500 lb (1,134 kg), round weight; and (3) the South Atlantic Unlimited Snapper-Grouper Permit must have reported black sea bass landings with pot gear between January 1, 2008, and December 31, 2010. There are 31 South Atlantic Unlimited Snapper-Grouper Permitholders who meet the criteria and who would receive an endorsement to fish for black sea bass using pot gear, which constitutes a sizable reduction from the 50 permit holders who fished using black sea bass pot gear during the 2011/2012 fishing year.

Related to the proposed endorsement program are provisions contained in Amendment 18A to allow for transferability of the endorsements once they are issued, and a 90-day opportunity to appeal the non-issuance of endorsements based on landings records. Additionally, Amendment 18A proposes to limit the number of black sea bass pot tags issued to any endorsement holder to 35 per vessel each permit year. Previously there was no limit on the number of pot tags a South Atlantic Unlimited Snapper-Grouper Permit holder could obtain and use.

Amendment 18A also includes a 1,000 lb (454 kg), round weight, commercial trip limit intended to further reduce the rate of harvest of black sea bass. This action, paired with the endorsement program, is expected to result in the commercial fishing season, which begins on June 1, remaining open until August or September of the 2012/2013 fishing year, which is approximately 1 to 2 months longer than the previous fishing year.

The Council determined a modification to the current size limit regulations for black sea bass may also help to reduce the rate of harvest in the commercial and recreational sectors. Therefore, Amendment 18A contains an action to change the recreational minimum size limit from 12 inches (30.5 cm), total length (TL) to 13 inches (33 cm), TL, and to increase the commercial minimum size limit from 10 inches (25.4 cm), TL, to 11 inches (28 cm), TL. In addition, Amendment 18A would require that all black sea bass pots be returned to shore (but may remain on the vessel) at the conclusion of each trip, in order to reduce bycatch of non-target species and reduce the risk of protected species interactions with vertical line gear.

In October 2011, a new stock assessment for black sea bass was completed through the Southeast Data Assessment and Review process. The stock assessment indicates that black sea bass are no longer overfished but have not yet been fully rebuilt. A 10-year rebuilding plan was implemented in 2006 and should end in 2016. Amendment 18A contains actions to modify the current rebuilding strategy for black sea bass based on the outcome of this new stock assessment. The Council voted to modify the current constant catch rebuilding strategy to one that would hold catch constant (847,000 lb (384,193 kg)) round weight, (718,000 lb (325,679 kg)) gutted weight, in fishing years 2012/2013 and 2013/2014 and then change to Frebuildin 2014/2015. Frebuildis defined as a constant fishing mortality strategy that maintains the 66 percent probability of recovery rate throughout the remaining fishing seasons of the rebuilding timeframe. After the 2015/2016 fishing season, the fishing mortality rate would be held constant until modified. Additionally, Amendment 18A would set a new stock ACL for black sea bass, which would be equal to the optimum yield and the acceptable biological catch (ABC), which is 847,000 lb (384,193 kg) round weight, 718,000 lb (325,679 kg) gutted weight. The ACL would remain the same during the next two fishing seasons, after which a new assessment update would need to be completed to determine whether or not it is appropriate to increase the ACL in the 2015/2016 fishing year. Based on the current allocation formula implemented through the final rule for Amendment 13C to the FMP (71 FR 55096, September 21, 2006), the commercial allocation is 43 percent of the ABC and the recreational allocation is 57 percent of the ABC. Therefore, the commercial ACL would be set at 309,000 lb (140,160 kg) gutted weight, 364,620 lb (165,389 kg) round weight, and the recreational ACL would be set at 409,000 lb (185,519 kg) gutted weight, 482,620 lb (218,913 kg) round weight. Amendment 18A also proposes an annual catch target (ACT) of 357,548 lb (162,180 kg kg) gutted weight, 421,907 lb (191,400 kg) round weight, for the recreational sector, which is set at a level lower than the ACL to help prevent ACL overages from occurring. In the case of black sea bass, the recreational ACT would not trigger any preventative or corrective action. The ACT would serve as a management reference point to track the effectiveness of management measures intended to control recreational harvest.

Amendment 17B to the FMP (Amendment 17B) implemented a system of accountability measures (AMs) for the commercial and recreational black sea bass sectors to limit harvest to the sector ACLs and correct for ACL overages if they occur. Subsequent to the implementation of Amendment 17B, the Council determined the methodology employed by the system of AMs under Amendment 17B may not be the most appropriate way to constrain harvest at or below the sector ACLs and it could unnecessarily penalize participants in the commercial and recreational sectors of the black sea bass component of the snapper-grouper fishery. Therefore, Amendment 18A proposes to modify the AMs specified in Amendment 17B to eliminate the use of the 3-year running average to determine ACL overages. Eliminating the 3-year running average would result in a reduced risk of implementing overly conservative AMs. The modified AMs in Amendment 18A would also implement a payback provision if the commercial ACL is exceeded, and includes a payback provision in the event the recreational ACL is exceeded regardless of the overfished status of the stock.

In addition to the actions listed previously, Amendment 18A would also require vessels that have South Atlantic Charter/Headboat Snapper-Grouper Permits to report landings information electronically, if selected to do so by NMFS. Reporting would be required on a weekly or daily basis.

The Council has submitted Amendment 18A for Secretarial review, approval, and implementation. The decision to approve, partially approve, or disapprove Amendment 18A will be based, in part, on consideration of comments, recommendations, and information received during the comment period on this notice of availability. After consideration of these factors, and in consistency with the Magnuson-Stevens Act and other applicable laws, NMFS will publish a notice of agency action in theFederal Registerannouncing the Agency's decision to approve, partially approve, or disapprove Amendment 18A, and the associated rationale.

Proposed Rule for Amendment 18A

A proposed rule that would implement measures outlined in Amendment 18A has been received from the Council. In accordance with the Magnuson-Stevens Act, NMFS is evaluating Amendment 18A to determine whether it is consistent with the FMP, the Magnuson-Stevens Act, and other applicable law. If that determination is affirmative, NMFS will publish the proposed rule in theFederal Registerfor public review and comment.

Consideration of Public Comments

Comments received by April 2, 2012, whether specifically directed to the amendment or the proposed rule, will be considered by NMFS in its decision to approve, disapprove, or partially approve the amendment. Comments received after that date will not be considered by NMFS in this decision. All comments received by NMFS on theamendment or the proposed rule during their respective comment periods will be addressed in the final rule.

The Ochoco National Forest is preparing an environmental impact statement (EIS) to analyze the effects of managing fuels and vegetation within the 25,526-acre McKay project area, which is about 11 miles northeast of Prineville, Oregon. The project area includes National Forest System lands in the McKay Watershed. The alternatives that will be analyzed include the proposed action, no action, and additional alternatives that respond to issues generated through the scoping process. The Ochoco National Forest will give notice of the full environmental analysis and decision making process so interested and affected people may participate and contribute to the final decision.

DATES:

Comments concerning the scope of the analysis must be received by March 1, 2012. The draft environmental impact statement is expected to be completed and available for public comment in November, 2012. The final environmental impact statement is expected to be completed in February, 2013.

ADDRESSES:

Send written comments to Slater Turner, District Ranger, Lookout Mountain District, Ochoco National Forest, 3160 NE. Third Street, Prineville, Oregon 97754. Alternately, electronic comments may be sent to comments-pacificnorthwest-ochoco@fs.fed.us. Electronic comments must be submitted as part of the actual email message, or as an attachment in plain text (.txt), Microsoft Word (.doc), rich text format (.rtf), or portable document format (.pdf).

FOR FURTHER INFORMATION CONTACT:

Marcy Anderson, Project Leader, at 3160 NE. Third Street, Prineville, Oregon 97754, or at (541) 416-6463, or by email at marcelleanderson@fs.fed.us.

SUPPLEMENTARY INFORMATION:

Purpose and Need for Action

The existing condition of the McKay Watershed was evaluated in 2006 and documented in the McKay Watershed Analysis. The Watershed Analysis (WA) determined that vegetation conditions in the watershed have departed from the historic condition in several ways:

• Areas where dwarf mistletoe in overstory trees is affecting the growth and sustainability of the next generation of trees.

• A reduction in upland shrub habitat.

• A decline in the condition of riparian vegetation.

The project area contains McKay and Little McKay creeks, both of which are on the Oregon Department of Environmental Quality's 303(d) list of water quality limited waters; both streams are listed due to high summer water temperatures. Stream temperature can be affected by stream shade, which may be provided by riparian vegetation. Riparian vegetation, especially deep-rooted hardwoods, contributes to bank stability and stream structure and also provides important habitat for many bird species. Large conifers near streams eventually fall and contribute to instream wood, which is an important component of fish habitat and contributor to stream form and function. Streams in the McKay Watershed are often deficient in streamside vegetation, due to recreation and past management. Large conifers along streams are at risk of loss due to understory competition and fuels accumulation.

Based upon direction from the Ochoco Forest Plan and opportunities identified in the McKay WA, the Lookout Mountain Ranger District has determined that within the McKay project area:

1. There is a need to strategically reduce forest vegetation density and fuel loadings to reduce the risk that disturbance events such as insect, disease and wildfire will lead to a loss of desired forest conditions.

2. There is a need to increase or maintain large tree structure and hardwood abundance and diversity in RHCAs while meeting the need identified in point #1.

3. There is a need to contribute to the local and regional economies by providing timber and other wood fiber products now and in the future.

The responsible official will be Kate Klein, Forest Supervisor, Ochoco National Forest, 3160 NE. Third Street, Prineville, Oregon 97754.

Nature of Decision To Be Made

Given the purpose and need, the deciding official will review the proposed action, the other alternatives, and the environmental consequences in order to decide whether and under what circumstances fuels and vegetation management will be implemented in the McKay Fuels and Vegetation project area.

Preliminary Issues

The project's interdisciplinary team has developed a list of preliminary issues that will be used during the analysis of effects. Other issues may arise as a result of public comment and further analysis. Preliminary issues include:

•Invasive Plant Species (Noxious Weeds).Several populations of noxious weeds are known to exist within the project area. There is a risk that management activities may exacerbate the weed situation by spreading existing populations or introducing new ones.

•Peck's Mariposa Lily.Management activities can improve habitat for this sensitive species, but also risk impacting individual plants and/or habitat where it occurs in the project area.

•Soil Productivity.Maintenance of soil productivity is an important objective for management of National Forest Lands. When mechanized equipment is used in the Forest, soil can become displaced and compacted, which can impact productivity.

•Water Quality.The main streams in the project area, McKay and Little McKay Creeks, are listed on Oregon DEQ's 303(d) list due to high summer temperatures. Management activities can result in reduced shade on streams, as well as contribute sediment into the streams, which impacts water quality and decreases habitat quality for fish and other riparian fauna.

•Wildlife Habitat.Activities intended to improve forest health and resiliency may reduce habitat effectiveness for some wildlife species, including forest raptors and big game.

•Economics.In the current economy, markets for wood products are severely depressed. Some forest work is extremely labor-intensive and the Forest Service depends on these markets to pay for the work that is needed to improve forest health and reduce fuels.

Scoping Process

This notice of intent initiates the scoping process, which guides the development of the environmental impact statement. At this time, the Ochoco National Forest plans to hold a public field trip to the project area in the late spring or early summer of 2012; details will be made public closer to that time.

It is important that reviewers provide their comments at such times and in such manner that they are useful to the agency's preparation of the environmental impact statement. Therefore, comments should be provided prior to the close of the comment period and should clearly articulate the reviewer's concerns and contentions.

Comments received in response to this solicitation, including names and addresses of those who comment, will be part of the public record for this proposed action. Comments submitted anonymously will be accepted and considered.

An application has been submitted to the Executive Secretary of the Foreign-Trade Zones Board (the Board) by Lincoln Foreign-Trade Zone, Inc., grantee of FTZ 59, requesting temporary/interim manufacturing (T/IM) authority at two sites within FTZ 59 at Novartis Consumer Health, Inc. (Novartis) facilities, located in Lincoln, Nebraska. The application was filed on January 24, 2012.

FTZ procedures could exempt Novartis from customs duty payments on the foreign components used in export production. The company anticipates that some 5-10 percent of the plant's shipments will be exported. On its domestic sales, Novartis would be able to choose the duty rates during customs entry procedures that apply to the OTC pharmaceutical products (duty free) for the foreign inputs noted above. Novartis would also be exempt from duty payments on foreign materials that become scrap or waste during the production process.

In accordance with the Board's regulations, Diane Finver of the FTZ Staff is designated examiner to evaluate and analyze the facts and information presented in the application and case record and to report findings and recommendations pursuant to Board Orders 1347 and 1480.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at the following address: Office of the Executive Secretary, Foreign-Trade Zones Board, U.S. Department of Commerce, Room 2111, 1401 Constitution Ave. NW., Washington, DC 20230. The closing period for their receipt is March 1, 2012.

Novartis has also submitted a request to the FTZ Board for FTZ manufacturing authority beyond a two-year period, which may include additional products and components. It should be noted that the request for extended authority would be docketed separately and would be processed as a distinct proceeding. Any party wishing to submit comments for consideration regarding the request for extended authority would need to submit such comments pursuant to the separate notice that would be published for that request.

A copy of the application will be available for public inspection at the Office of the Foreign-Trade Zones Board's Executive Secretary at the address listed above, and in the “Reading Room” section of the Board's Web site, which is accessible viawww.trade.gov/ftz.For further information, contact Diane Finver atDiane.Finver@trade.govor 202-482-1367.

The Department of Commerce (“the Department”) has received requests to conduct administrative reviews of various antidumping and countervailing duty orders and findings with December anniversary dates. In accordance with the Department's regulations, we are initiating those administrative reviews. The Department also received requests to revoke two antidumping duty orders in part.

The Department has received timely requests, in accordance with 19 CFR 351.213(b), for administrative reviews of various antidumping and countervailing duty orders and findings with December anniversary dates. The Department also received a timely request to revoke in part the antidumping duty orders on certain cased pencils from the People's Republic of China for two exporters, and on honey from Argentina with respect to four exporters.

All deadlines for the submission of various types of information, certifications, or comments or actions by the Department discussed below refer to the number of calendar days from the applicable starting time.

Notice of No Sales

If a producer or exporter named in this notice of initiation had no exports, sales, or entries during the period of review (“POR”), it must notify the Department within 60 days of publication of this notice in theFederal Register. All submissions must be filed electronically athttp://iaaccess.trade.govin accordance with 19 CFR 351.303.See Antidumping and Countervailing Duty Proceedings: Electronic Filing Procedures; Administrative Protective Order Procedures,76 FR 39263 (July 6, 2011). Such submissions are subject to verification in accordance with section 782(i) of the Tariff Act of 1930, as amended (“Act”). Further, in accordance with 19 CFR 351.303(f)(3)(ii), a copy of each request must be served on the petitioner and each exporter or producer specified in the request.

Respondent Selection

In the event the Department limits the number of respondents for individual examination for administrative reviews, the Department intends to select respondents based on U.S. Customs and Border Protection (“CBP”) data for U.S. imports during the POR. We intend to release the CBP data under Administrative Protective Order (“APO”) to all parties having an APO within seven days of publication of this initiation notice and to make our decision regarding respondent selection within 21 days of publication of thisFederal Registernotice. The Department invites comments regarding the CBP data and respondent selection within five days of placement of the CBP data on the record of the applicable review.

In the event the Department decides it is necessary to limit individual examination of respondents and conduct respondent selection under section 777A(c)(2) of the Act:

In general, the Department has found that determinations concerning whether particular companies should be “collapsed” (i.e., treated as a single entity for purposes of calculating antidumping duty rates) require a substantial amount of detailed information and analysis, which often require follow-up questions and analysis. Accordingly, the Department will not conduct collapsing analyses at the respondent selection phase of this review and will not collapse companies at the respondent selection phase unless there has been a determination to collapse certain companies in a previous segment of this antidumping proceeding (i.e., investigation, administrative review, new shipper review or changed circumstances review). For any company subject to this review, if the Department determined, or continued to treat, that company as collapsed with others, the Department will assume that such companies continue to operate in the same manner and will collapse them for respondent selection purposes. Otherwise, the Department will not collapse companies for purposes of respondent selection. Parties are requested to (a) identify which companies subject to review previously were collapsed, and (b) provide a citation to the proceeding in which they were collapsed. Further, if companies are requested to complete the Quantity and Value Questionnaire for purposes of respondent selection, in general each company must report volume and value data separately for itself. Parties should not include data for any other party, even if they believe they should be treated as a single entity with that other party. If a company was collapsed with another company or companies in the most recently completed segment of this proceeding where the Department considered collapsing that entity, complete quantity and value data for that collapsed entity must be submitted.

Deadline for Withdrawal of Request for Administrative Review

Pursuant to 19 CFR 351.213(d)(1), a party that has requested a review may withdraw that request within 90 days of the date of publication of the notice of initiation of the requested review. The regulation provides that the Department may extend this time if it is reasonable to do so. In order to provide parties additional certainty with respect to when the Department will exercise its discretion to extend this 90-day deadline, interested parties are advised that, with regard to reviews requested on the basis of anniversary months on or after August 2011, the Department does not intend to extend the 90-day deadline unless the requestor demonstrates that an extraordinary circumstance has prevented it from submitting a timely withdrawal request. Determinations by the Department to extend the 90-day deadline will be made on a case-by-case basis.

Separate Rates

In proceedings involving non-market economy (“NME”) countries, the Department begins with a rebuttable presumption that all companies within the country are subject to government control and, thus, should be assigned a single antidumping duty deposit rate. It is the Department's policy to assign all exporters of merchandise subject to an administrative review in an NME country this single rate unless an exporter can demonstrate that it is sufficiently independent so as to be entitled to a separate rate.

To establish whether a firm is sufficiently independent fromgovernment control of its export activities to be entitled to a separate rate, the Department analyzes each entity exporting the subject merchandise under a test arising from theFinal Determination of Sales at Less Than Fair Value: Sparklers from the People's Republic of China,56 FR 20588 (May 6, 1991), as amplified byFinal Determination of Sales at Less Than Fair Value: Silicon Carbide from the People's Republic of China,59 FR 22585 (May 2, 1994). In accordance with the separate rates criteria, the Department assigns separate rates to companies in NME cases only if respondents can demonstrate the absence of bothde jureandde factogovernment control over export activities.

All firms listed below that wish to qualify for separate rate status in the administrative reviews involving NME countries must complete, as appropriate, either a separate rate application or certification, as described below. For these administrative reviews, in order to demonstrate separate rate eligibility, the Department requires entities for whom a review was requested, that were assigned a separate rate in the most recent segment of this proceeding in which they participated, to certify that they continue to meet the criteria for obtaining a separate rate. The Separate Rate Certification form will be available on the Department's Web site athttp://www.trade.gov/iaon the date of publication of thisFederal Registernotice. In responding to the certification, please follow the “Instructions for Filing the Certification” in the Separate Rate Certification. Separate Rate Certifications are due to the Department no later than 60 calendar days after publication of thisFederal Registernotice. The deadline and requirement for submitting a Certification applies equally to NME-owned firms, wholly foreign-owned firms, and foreign sellers who purchase and export subject merchandise to the United States.

Entities that currently do not have a separate rate from a completed segment of the proceeding1should timely file a Separate Rate Application to demonstrate eligibility for a separate rate in this proceeding. In addition, companies that received a separate rate in a completed segment of the proceeding that have subsequently made changes, including, but notlimited to, changes to corporate structure, acquisitions of new companies or facilities, or changes to their official company name,2should timely file a Separate Rate Application to demonstrate eligibility for a separate rate in this proceeding. The Separate Rate Status Application will be available on the Department's Web site athttp://www.trade.gov/iaon the date of publication of thisFederal Registernotice. In responding to the Separate Rate Status Application, refer to the instructions contained in the application. Separate Rate Status Applications are due to the Department no later than 60 calendar days of publication of thisFederal Registernotice. The deadline and requirement for submitting a Separate Rate Status Application applies equally to NME-owned firms, wholly foreign-owned firms, and foreign sellers that purchase and export subject merchandise to the United States.

1Such entities include entities that have not participated in the proceeding, entities that were preliminarily granted a separate rate in any currently incomplete segment of the proceeding (e.g.,an ongoing administrative review, new shipper review,etc.) and entities that lost their separate rate in the most recently complete segment of the proceeding in which they participated.

2Only changes to the official company name, rather than trade names, need to be addressed via a Separate Rate Application. Information regarding new trade names may be submitted via a Separate Rate Certification.

For exporters and producers who submit a separate-rate status application or certification and subsequently are selected as mandatory respondents, these exporters and producers will no longer be eligible for separate rate status unless they respond to all parts of the questionnaire as mandatory respondents.

Initiation of Reviews

In accordance with 19 CFR 351.221(c)(1)(i), we are initiating administrative reviews of the following antidumping and countervailing duty orders and findings. We intend to issue the final results of these reviews not later than December 31, 2012.

Duringany administrative review covering all or part of a period falling between the first and second or third and fourth anniversary of the publication of an antidumping duty order under 19 CFR 351.211 or a determination under 19 CFR 351.218(f)(4) to continue an order or suspended investigation (after sunset review), the Secretary, if requested by a domestic interested party within 30 days of the date of publication of the notice of initiation of the review, will determine, consistent withFAG Italiav.United States,291 F.3d 806 (Fed Cir. 2002), as appropriate, whether antidumping duties have been absorbed by an exporter or producer subject to the review if the subject merchandise is sold in the United States through an importer that is affiliated with such exporter or producer. The request must include the name(s) of the exporter or producer for which the inquiry is requested.

3If one of the above named companies does not qualify for a separate rate, all other exporters of Certain Cased Pencils from the PRC who have not qualified for a separate rate are deemed to be covered by this review as part of the single PRC entity of which the named exporters are a part.

4If one of the above named companies does not qualify for a separate rate, all other exporters of Hand Trucks and Parts Thereof from the PRC who have not qualified for a separate rate are deemed to be covered by this review as part of the single PRC entity of which the named exporters are a part.

5If one of the above named companies does not qualify for a separate rate, all other exporters of Honey from the PRC who have not qualified for a separate rate are deemed to be covered by this review as part of the single PRC entity of which the named exporters are a part.

6In accordance with 19 CFR 351.213(b), the petitioners requested an administrative review of this countervailing duty order. No individual exporters requested the review pursuant to 19 CFR 351.213(b). The Department conducted the investigation and subsequent administrative reviews of this order on an aggregate basis pursuant to section 777A(e)(2)(B) of the Act. Accordingly, the Department intends to conduct the review of this order on an aggregate basis.

For the first administrative review of any order, there will be no assessment of antidumping or countervailing duties on entries of subject merchandise entered, or withdrawn from warehouse, for consumption during the relevant provisional-measures “gap” period, of the order, if such a gap period is applicable to the period of review.

Interested parties must submit applications for disclosure under administrative protective orders in accordance with 19 CFR 351.305. On January 22, 2008, the Department publishedAntidumping and Countervailing Duty Proceedings: Documents Submission Procedures; APO Procedures,73 FR 3634 (January 22, 2008). Those procedures apply to administrative reviews included in this notice of initiation. Parties wishing to participate in any of these administrative reviews should ensure that the meet the requirements of these procedures (e.g.,the filing of separate letters of appearance as discussed at 19 CFR 351.103(d)).

Any party submitting factual information in an antidumping duty or countervailing duty proceeding must certify to the accuracy and completeness of that information.Seesection 782(b) of the Act. Parties are hereby reminded that revised certification requirements are in effect for company/government officials as well as their representatives in all segments of any antidumping duty or countervailing duty proceedings initiated on or after March 14, 2011.See Certification of Factual Information to Import Administration During Antidumping and Countervailing Duty Proceedings: Interim Final Rule,76 FR 7491 (February 10, 2011) (“Interim Final Rule”), amending 19 CFR 351.303(g)(1) and (2). The formats for the revised certifications are provided at the end of theInterim Final Rule.The Department intends to reject factual submissions in any proceeding segments initiated on or after March 14, 2011 if the submitting party does not comply with the revised certification requirements.

These initiations and this notice are in accordance with section 751(a) of the Act (19 U.S.C. 1675(a)) and 19 CFR 351.221(c)(1)(i).

On March 1, 2011, the Department of Commerce (“the Department”) initiated its third sunset review of the antidumping duty order on brass sheet and strip from Germany, pursuant to section 751(c) of the Tariff Act of 1930, as amended (“the Act”). Based on adequate substantive responses filed on behalf of both the domestic interested parties and the respondent interested parties, theDepartment determined to conduct a full sunset review of this antidumping order pursuant to 751(c) of the Act and 19 CFR 351.218(e)(2)(i). As a result of our analysis, the Department finds that revocation of the antidumping duty order on brass sheet and strip from Germany would likely lead to continuation or recurrence of dumping.

On March 1, 2011, the Department initiated the third sunset review of the antidumping duty order on brass sheet and strip from Germany, pursuant to section 751(c) of the Act.See Initiation of Five-Year (“Sunset”) Review,76 FR 11202 (March 1, 2011). The Department received a notice of intent to participate from domestic interested parties, GBC Metals, LLC, of Global Brass and Copper, Inc., doing business as Olin Brass; Heyco Metals, Inc.; Luvata North America, Inc.; PMX Industries, Inc.; Revere Copper Products, Inc.; and International Association of Machinists and Aerospace Workers, United Auto Workers (Local 2367 and Local 1024), and United Steelworkers AFL-CIO CLC (collectively, “Petitioners”), within the deadline specified in 19 CFR 351.218(d)(1)(i).

On March 31, 2011, the Department received a substantive response from Petitioners, and a substantive response from respondent interested parties in Germany, Wieland-Werke AG, Schwermetall Halbzeugwerk GmbH & Co. KG, and Messingwerk Plettenberg Herfeld & Co., KG (collectively, “Respondents”) within the deadline specified in 19 CFR 351.218(d)(3)(i). Based on the finding that the substantive responses were adequate, we determined to conduct a full sunset review of this antidumping duty order.SeeMemorandum from Susan H. Kuhbach, Director, AD/CVD Operations, Office 1, to Edward C. Yang, Acting Deputy Assistant Secretary for AD/CVD Operations entitled “Adequacy Determination: Third Five-Year (“Sunset”) Review of the Antidumping Duty Order on Brass Sheet and Strip from Germany,” dated June 7, 2011.

On September 26, 2011, the Department published in theFederal Registerthe preliminary results of this full third sunset review of the AD order on brass sheet and strip from Germany.See Brass Sheet and Strip from Germany: Preliminary Results of the Third Five-Year (“Sunset”) Review of the Antidumping Duty Order,76 FR 59386 (September 26, 2011) and accompanying Issues and Decision Memorandum.

The Department invited interested parties to comment on thePreliminary Results.On November 15, 2011, we received case briefs from Petitioners and Respondents. On November 21, 2011, we received rebuttal briefs from Petitioners and Respondents. No hearing was held because none was requested.

Scope of the Order

The product covered by the order is brass sheet and strip, other than leaded and tinned brass sheet and strip. The chemical composition of the covered product is currently defined in the Copper Development Association (“C.D.A.”) 200 Series or the Unified Numbering System (“U.N.S.”) C2000. The order does not cover products the chemical compositions of which are defined by other C.D.A. or U.N.S. series. In physical dimensions, the product covered by the order has a solid rectangular cross section over 0.006 inches (0.15 millimeters) through 0.188 inches (4.8 millimeters) in finished thickness or gauge, regardless of width. Coiled, wound-on-reels (traverse wound), and cut-to-length products are included. The merchandise is currently classified under Harmonized Tariff Schedule of the United States (“HTSUS”) item numbers 7409.21.00 and 7409.29.00.

Although the HTSUS item numbers are provided for convenience and customs purposes, the written description of the scope of the order remains dispositive.

Analysis of Comments Received

All issues raised in this sunset review are addressed in the “Issues and Decision Memorandum for the Sunset Review of the Antidumping Duty Order on Brass Sheet and Strip from Germany; Final Results” from Gary Taverman, Acting Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary for Import Administration (“Decision Memorandum'”), which is hereby adopted by, and issued concurrently with, this notice. The issues discussed in the Decision Memorandum are the likelihood of continuation or recurrence of dumping and the magnitude of the margins likely to prevail if the order is revoked. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum which is on file in the Central Records Unit, room 7046 of the main Department building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Web athttp://ia.ita.doc.gov/frn. The paper copy and electronic version of the Decision Memorandum are identical in content.

Final Results of Review

We determine that revocation of the antidumping duty order on brass sheet and strip from Germany would be likely to lead to continuation or recurrence of dumping at the following weighted-average percentage margins:

Manufacturers/producers/exportersMargin

(percent)

Wieland-Werke AG3.81All Others7.30Notification to Interested Parties

This notice also serves as the only reminder to parties subject to an administrative protective order (APO) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305. Timely notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.

We are issuing and publishing the final results of this review in accordance with sections 751(c), 752, and 777(i) of the Act.

The Department of Commerce (the Department) has received a request for a new shipper review of theantidumping duty order on honey from Argentina.See Notice of Antidumping Duty Order: Honey From Argentina,66 FR 63672 (December 10, 2001) (Order). In accordance with section 751(a)(2)(B) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.214(d), we are initiating an antidumping duty new shipper review of D'Ambros María de los Angeles and D'Ambros María Daniela SH, an Argentine partnership doing business as Apícola Danangie (Danangie). The period of review (POR) of this new shipper review is December 1, 2010, through November 30, 2011.

On December 10, 2001, the Department published the antidumping duty order on honey from Argentina.See Order,66 FR at 63672. Thus, the antidumping duty order on honey from Argentina has a December anniversary month. On January 3, 2012, the Department received a timely filed request dated December 31, 2011, for a new shipper review from Danangie. In its request for a review, Danangie identified itself as an exporter of the subject merchandise. For the purpose of initiating this new shipper review, the Department determines that Danangie's submission was timely filed.

Pursuant to the requirements set forth in section 751(a)(2)(B)(i) of the Act and 19 CFR 351.214(b)(2), Danangie certified that (1) it did not export subject merchandise to the United States during the period of investigation (POI) (seesection 751(a)(2)(B)(i)(I) of the Act and 19 CFR 351.214(b)(2)(i)); and (2) since the initiation of the investigation, it has never been affiliated with any company that exported subject merchandise to the United States during the POI, including those companies not individually examined during the investigation (seesection 751(a)(2)(B)(i)(II) of the Act and19 CFR 351.214(b)(2)(iii)(A)). Furthermore, as required by 19 CFR 351.214(b)(2), Danangie's suppliers, Luis Hauser and Nestor Pezelatto, provided certifications that (1) they did not export the subject merchandise to the United States during the POI or at any time following the POI and (2) since the initiation of the investigation, they have never been affiliated with any company that exported subject merchandise to the United States during the POI, including those companies not individually examined during the investigation. Additionally, in accordance with 19 CFR 351.214(b)(2)(iv), Danangie submitted documentation establishing the following: (1) The date on which it first shipped subject merchandise to the United States; (2) the volume of its first shipment; and (3) the date of its first sale to an unaffiliated purchaser for exportation to the United States. Danangie also stated it had no shipments to the United States during the period subsequent to its first shipment.

Initiation of Review

Based on information on the record and in accordance with section 751(a)(2)(B) of the Act, and 19 CFR 351.214(d), we find that the request submitted by Danangie meets the statutory and regulatory requirements for initiation of a new shipper review.SeeMemorandum to the File, through Angelica L. Mendoza, Program Manager, regarding “Initiation of the Antidumping Duty New Shipper Review: Honey From Argentina,” dated January 25, 2012 (Initiation Checklist). Accordingly, we are initiating a new shipper review of the antidumping duty order on honey from Argentina exported by Danangie, for the period December 1, 2010, through November 30, 2011. However, the Department has concerns with certain other information contained within the entry data received from U.S. Customs and Border Protection (CBP). Due to the business proprietary nature of this information, please refer to the Initiation Checklist for further discussion. The Department intends to address this issue after initiation of the new shipper review. If the Department subsequently determines, based on information collected, that a new shipper review for Danangie is not warranted, the Department may rescind the review or apply facts available pursuant to section 776 of the Act, as appropriate.

We intend to issue the preliminary results of this review no later than 180 days after the date on which this review is initiated, and the final results within 90 days after the date on which we issue the preliminary results.Seesection 751(a)(2)(B)(iv) of the Act and 19 CFR 351.214(h)(i).

We will instruct CBP to allow, at the option of the importer, the posting, until the completion of the review, of a bond or security in lieu of a cash deposit for certain entries of the subject merchandise exported by Danangie and produced by Luis Hauser or Nestor Pezelatto in accordance with section 751(a)(2)(B)(iii) of the Act and 19 CFR 351.214(e). Because Danangie certified that the sales of subject merchandise which form the basis for its new shipper review request were produced by Luis Hauser and Nestor Pezelatto, we will instruct CBP to permit the use of a bond only for entries of subject merchandise which Danangie exported and was produced by Luis Hauser or Nestor Pezelatto.

Interested parties may submit applications for disclosure under administrative protective order in accordance with 19 CFR 351.305 and 351.306.

This initiation and this notice are issued and published in accordance with section 751(a)(2)(B) of the Act and 19 CFR 351.214 and 351.221(c)(1)(i).

On December 21, 2011, based on a request from Petitioner, SolarWorld Industries America, Inc. (SolarWorld), the Department of Commerce (the Department) extended the due date for the preliminary determination of the countervailing duty investigation of crystalline silicon photovoltaic cells, whether or not assembled into modules,from the People's Republic of China, to no later than February 13, 2012.1

Section 703(b)(1) of the Tariff Act of 1930, as amended (the Act), requires the Department to issue the preliminary determination in a countervailing duty investigation within 65 days after the date on which the Department initiated the investigation. However, section 703(c)(1)(A) of the Act permits the Department to postpone making the preliminary determination until no later than 130 days after the date on which it initiated the investigation if, among other reasons, the petitioner makes a timely request for an extension. In the instant investigation, SolarWorld made a second timely request on January 19, 2012, for further postponement of the preliminary countervailing duty determination by 18 days, to March 2, 2012.2

2See19 CFR 351.205(e) and the petitioner's January 19, 2012 letter requesting a second postponement of the preliminary determination.

Therefore, pursuant to the discretion afforded to the Department under section 703(c)(1)(A) of the Act, and because the Department does not find any compelling reason to deny the request, we are extending the due date for the preliminary determination to no later than March 2, 2012.

This notice is issued and published pursuant to section 703(c)(2) of the Act and 19 CFR 351.205(f)(1).

National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

ACTION:

Notice; receipt of application.

SUMMARY:

Notice is hereby given that Colleen Reichmuth, Ph.D., University of California at Santa Cruz, Long Marine Laboratory, 100 Shaffer Road, Santa Cruz, CA, has applied in due form for a permit to take bearded seals (Erignathus barbatus) for research purposes.

DATES:

Written, telefaxed, or email comments must be received on or before March 1, 2012.

ADDRESSES:

The application and related documents are available for review by selecting “Records Open for Public Comment” from theFeaturesbox on the Applications and Permits for Protected Species (APPS) home page,https://apps.nmfs.noaa.gov,and then selecting File No. 15142 from the list of available applications.

These documents are also available upon written request or by appointment in the following offices:

Written comments on this application should be submitted to the Chief, Permits and Conservation Division, at the address listed above. Comments may also be submitted by facsimile to (301) 713-0376, or by email toNMFS.Pr1Comments@noaa.gov.Please include “File No. 15142” in the subject line of the email comment.

Those individuals requesting a public hearing should submit a written request to the Chief, Permits and Conservation Division at the address listed above. The request should set forth the specific reasons why a hearing on this application would be appropriate.

FOR FURTHER INFORMATION CONTACT:

Amy Sloan or Tammy Adams, (301) 427-8401.

SUPPLEMENTARY INFORMATION:

The subject permit is requested under the authority of the Marine Mammal Protection Act of 1972, as amended (MMPA; 16 U.S.C. 1361et seq.), and the regulations governing the taking and importing of marine mammals (50 CFR part 216).

The applicant proposes to collect from the wild up to two bearded seals in the Northwest Arctic Borough of Alaska for a long-term behavioral study at Long Marine Laboratory in Santa Cruz, CA. Up to four bearded seals may be captured temporarily in order to evaluate their suitability for participation in research. Captured seals deemed unsuitable for the long-term study will be released at the capture site. Up to two bearded seals deemed suitable for captive research will be transported from Kotzebu, AK to Santa Cruz, CA. Incidental harassment of up to one ringed seal (Phoca hispida) and one spotted seal (Phoca larga) may occur during capture activities. Authorization for mortality of two bearded seals is requested for the duration of the permit. The applicant requests the permit be valid from October 1, 2012 to December 31, 2013. After a quarantine period, the research to be conducted at Long Marine Laboratory will occur under existing NMFS Permit No. 14535-01 (75 FR 58352) and will provide quantitative measurements of the amphibious hearing capabilities of bearded seals, which are needed to improve understanding of the potential effects of expected increases in anthropogenic activities in polar habitats.

In compliance with the National Environmental Policy Act of 1969 (42 U.S.C. 4321et seq.), an initial determination has been made that the activity proposed is categorically excluded from the requirement to prepare an environmental assessment or environmental impact statement.

Concurrent with the publication of this notice in theFederal Register, NMFS is forwarding copies of the application to the Marine Mammal Commission and its Committee of Scientific Advisors.

NMFS has received an application from Lamont-Doherty Earth Observatory (L-DEO), a part of Columbia University, for an Incidental Harassment Authorization (IHA) to take marine mammals, by harassment, incidental to conducting a marine geophysical survey in the northwest Pacific Ocean, March through April, 2012.

DATES:

Comments and information must be received no later than March 1, 2012.

ADDRESSES:

Comments on the application should be addressed to P. Michael Payne, Chief, Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service, 1315 East-West Highway, Silver Spring, MD 20910-3225. The mailbox address for providing email comments isITP.Cody@noaa.gov.NMFS is not responsible for email comments sent to addresses other than the one provided here. Comments sent via email, including all attachments, must not exceed a 10-megabyte file size.

All comments received are a part of the public record and will generally be posted tohttp://www.nmfs.noaa.gov/pr/permits/incidental.htm#applicationswithout change. All Personal Identifying Information (for example, name, address, etc.) voluntarily submitted by the commenter may be publicly accessible. Do not submit confidential business information or otherwise sensitive or protected information.

An electronic copy of the application containing a list of the references used in this document may be obtained by writing to the above address, telephoning the contact listed here (seeFOR FURTHER INFORMATION CONTACT) or visiting the internet at:http://www.nmfs.noaa.gov/pr/permits/incidental.htm#applications.

The following associated documents are also available at the same internet address: the National Science Foundation's (NSF) draft Environmental Analysis (EA) pursuant to Executive Order 12114. The EA incorporates an “Environmental Assessment of a Marine Geophysical Survey by the R/VMarcus G. Langsethin the Northwest Pacific Ocean, March-April, 2012,” prepared by LGL Limited, on behalf of NSF. Documents cited in this notice may be viewed, by appointment, during regular business hours, at the aforementioned address.

FOR FURTHER INFORMATION CONTACT:

Jeannine Cody, Office of Protected Resources, NMFS, (301) 427-8401.

SUPPLEMENTARY INFORMATION:Background

Section 101(a)(5)(D) of the Marine Mammal Protection Act of 1972, as amended (MMPA; 16 U.S.C. 1361et seq.) directs the Secretary of Commerce to authorize, upon request, the incidental, but not intentional, taking of small numbers of marine mammals of a species or population stock, by United States citizens who engage in a specified activity (other than commercial fishing) within a specified geographical region if certain findings are made and, if the taking is limited to harassment, a notice of a proposed authorization is provided to the public for review.

Authorization for the incidental taking of small numbers of marine mammals shall be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s), and will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses (where relevant). The authorization must set forth the permissible methods of taking, other means of effecting the least practicable adverse impact on the species or stock and its habitat, and requirements pertaining to the mitigation, monitoring and reporting of such takings. NMFS has defined “negligible impact” in 50 CFR 216.103 as “* * * an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.”

Section 101(a)(5)(D) of the MMPA established an expedited process by which citizens of the United States can apply for an authorization to incidentally take small numbers of marine mammals by harassment. Section 101(a)(5)(D) of the MMPA establishes a 45-day time limit for NMFS' review of an application followed by a 30-day public notice and comment period on any proposed authorizations for the incidental harassment of small numbers of marine mammals. Within 45 days of the close of the public comment period, NMFS must either issue or deny the authorization. NMFS must publish a notice in theFederal Registerwithin 30 days of its determination to issue or deny the authorization.

Any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].

Summary of Request

NMFS received an application on October 31, 2011, from L-DEO for the taking by harassment, of marine mammals, incidental to conducting a marine geophysical survey in the northwest Pacific Ocean in international waters. Upon receipt of additional information, NMFS determined the application complete and adequate on December 23, 2011.

L-DEO, with research funding from the U.S. National Science Foundation (NSF), plans to conduct the survey from March 24, 2012, through April 16, 2012. L-DEO received an IHA in 2010 to conduct the same specified activity in the same location. However, due to medical emergencies, L-DEO suspended its operations and was unable to complete the seismic survey. Thus, this 2011 survey will allow L-DEO to acquire data necessary to complete the abbreviated 2010 study.

L-DEO plans to use one source vessel, the R/VMarcus G.Langseth(Langseth), a seismic airgun array and a single hydrophone streamer to conduct a geophysical survey at the Shatsky Rise, a large igneous plateau in the northwest Pacific Ocean. The proposed survey will provide data necessary to decipher the crustal structure of the Shatsky Rise; may address major questions of earth history, geodynamics, and tectonics; could impact the understanding of terrestrial magmatism and mantle convection; and may obtain data that could be used to improve estimates of regional earthquake occurrence and distribution. In addition to the operations of the seismic airgun array and hydrophone streamer, L-DEO intends to operate a multibeam echosounder (MBES) and a sub-bottom profiler (SBP) continuously throughout the survey.

Acoustic stimuli (i.e.,increased underwater sound) generated during the operation of the seismic airgun array, may have the potential to cause a short-term behavioral disturbance for marine mammals in the survey area. This is the principal means of marine mammal taking associated with these activities and L-DEO has requested an authorization to take 30 species of marine mammals by Level B harassment. Take is not expected to result from the use of the MBES or the SBP for reasons discussed in this notice. Also, NMFS does not expect take to result from collision with theLangsethbecause it is a single vessel moving atrelatively slow speeds (4.6 knots (kts); 8.5 km per hr (km/h); 5.3 miles (mi) per hour (mph)) during seismic acquisition within the survey, for a relatively short period of time. It is likely that any marine mammal would be able to avoid the vessel.

Description of the Specified Activity

L-DEO's proposed seismic survey on the Shatsky Rise is scheduled to commence on March 24, 2012 and end on April 16, 2012. TheLangsethwould depart from Yokohama, Japan on March 24, 2012 and transit to the survey area in the northwest Pacific Ocean, approximately 1,200 kilometers (km) (745.6 miles (mi)) in international waters offshore of the east coast of Japan. At the conclusion of the survey activities, theLangsethproposes to arrive in Honolulu, Hawaii, on April 16, 2012. Some minor deviation from these dates is possible, depending on logistics, weather conditions, and the need to repeat some lines if data quality is substandard. Therefore, NMFS proposes to issue an authorization that is effective from March 24, 2012 to May 7, 2012.

Geophysical survey activities will involve 3-D seismic methodologies to decipher the crustal structure of the Shatsky Rise. To obtain high-resolution, 2-D structures of the area's magmatic systems and thermal structures, theLangsethwill deploy a 36-airgun array as an energy source and a 6-km-long (3.7 mi-long) hydrophone streamer. As the airgun array is towed along the survey lines, the hydrophone streamer will receive the returning acoustic signals and transfer the data to the vessel's on-board processing system.

The proposed study (e.g., equipment testing, startup, line changes, repeat coverage of any areas, and equipment recovery) will require approximately 7 days (d) to complete approximately 1,216 km (755.6 mi) of transect lines. TheLangsethwill conduct additional seismic operations in the survey area associated with turns, airgun testing, and repeat coverage of any areas where the initial data quality is sub-standard. Data acquisition will include approximately 168 hours (hr) of airgun operations (7 d x 24 hr).

L-DEO, theLangseth'soperator, will conduct all planned seismic data acquisition activities, with on-board assistance by the scientists who have proposed the study. The Principal Investigators for this survey are Drs. Jun Korenaga (Yale University, New Haven, CT) and William Sager (Texas A&M University, College Station, TX). The vessel will be self-contained, and the crew will live aboard the vessel for the entire cruise.

Description of the Specified Geographic Region

L-DEO will conduct the proposed survey in international waters in the northwest Pacific Ocean. The study area will encompass an area on the Shatsky Rise bounded by approximately 33.5-36 degrees (°) North by 156-161° East (see Figure 1 in L-DEO's application). Water depths in the survey area range from approximately 3,000 to 5,000 meters (m) (1.9 to 3.1 mi).

Vessel Specifications

TheLangseth,owned by NSF, is a seismic research vessel with a propulsion system designed to be as quiet as possible to avoid interference with the seismic signals emanating from the airgun array. The vessel, which has a length of 71.5 m (235 feet (ft)); a beam of 17.0 m (56 ft); a maximum draft of 5.9 m (19 ft); and a gross tonnage of 3,834 pounds, is powered by two 3,550 horsepower (hp) Bergen BRG-6 diesel engines which drive two propellers. Each propeller has four blades and the shaft typically rotates at 750 revolutions per minute. The vessel also has an 800-hp bowthruster, which is not used during seismic acquisition. TheLangseth'soperation speed during seismic acquisition will be approximately 4.6 kts (8.5 km/h; 5.3 mph) and the cruising speed of the vessel outside of seismic operations is 18.5 km/h (11.5 mph or 10 kts).

TheLangsethwill tow the 36-airgun array, as well as the hydrophone streamer, along predetermined lines. When theLangsethis towing the airgun array and the hydrophone streamer, the turning rate of the vessel is limited to five degrees per minute. Thus, the maneuverability of the vessel is limited during operations with the streamer.

The vessel also has an observation tower from which protected species visual observers (PSVO) will watch for marine mammals before and during the proposed airgun operations. When stationed on the observation platform, the PSVO's eye level will be approximately 21.5 m (71 ft) above sea level providing the PSVO an unobstructed view around the entire vessel.

Acoustic Source SpecificationsSeismic Airguns

TheLangsethwill deploy a 36-airgun array, with a total volume of approximately 6,600 cubic inches (in3) at a tow depth of 9 m (29.5 ft). The airguns are a mixture of Bolt 1500LL and Bolt 1900LLX airguns ranging in size from 40 to 360 in3, with a firing pressure of 1,900 pounds per square inch. The dominant frequency components range from zero to 188 Hertz (Hz). The array configuration consists of four identical linear strings, with 10 airguns on each string; the first and last airguns will be spaced 16 m (52 ft) apart. Of the 10 airguns, nine will fire simultaneously while the tenth airgun will serve as a spare and will be turned on in case of failure of one of the other airguns. TheLangsethwill distribute the array across an area of approximately 24 x 16 m (78.7 x 52.5 ft) and will tow the array approximately 140 m (459.3 ft) behind the vessel. The tow depth of the array will be 9 m (29.5 ft).

During the multichannel seismic (MCS) survey, each airgun array will emit a pulse at approximately 20-second (s) intervals which corresponds to a shot interval of approximately 50 m (164 ft). During firing, the airguns will emit a brief (approximately 0.1 s) pulse of sound; during the intervening periods of operations, the airguns will be silent.

Metrics Used in This Document

This section includes a brief explanation of the sound measurements frequently used in the discussions of acoustic effects in this document. Sound pressure is the sound force per unit area, and is usually measured in micropascals (μPa), where 1 pascal (Pa) is the pressure resulting from a force of one newton exerted over an area of one square meter. Sound pressure level (SPL) is expressed as the ratio of a measured sound pressure and a reference level. The commonly used reference pressure level in underwater acoustics is 1 μPa, and the units for SPLs are dB re: 1 μPa.

SPL (in decibels (dB)) = 20 log (pressure/reference pressure)

SPL is an instantaneous measurement and can be expressed as the peak, the peak-peak (p-p), or the root mean square (rms). Root mean square, which is the square root of the arithmetic average of the squared instantaneous pressure values, is typically used in discussions of the effects of sounds on vertebrates and all references to SPL in this document refer to the root mean square unless otherwise noted. SPL does not take the duration of a sound into account.

Characteristics of the Airgun Pulses

Airguns function by venting high-pressure air into the water which creates an air bubble. The pressure signature of an individual airgun consists of a sharp rise and then fall in pressure, followedby several positive and negative pressure excursions caused by the oscillation of the resulting air bubble. The oscillation of the air bubble transmits sounds downward through the seafloor and the amount of sound transmitted in the near horizontal directions is reduced. However, the airgun array also emits sounds that travel horizontally toward non-target areas.

The nominal source levels of the airgun array used by L-DEO on theLangsethis 236 to 265 dB re: 1 μPa(p-p)and the rms value for a given airgun pulse is typically 16 dB re: 1 μPa lower than the peak-to-peak value (Greene, 1997; McCauleyet al.,1998, 2000a). However, the difference between rms and peak or peak-to-peak values for a given pulse depends on the frequency content and duration of the pulse, among other factors.

Accordingly, L-DEO has predicted the received sound levels in relation to distance and direction from the 36-airgun array and the single Bolt 1900LL 40-in3airgun, which will be used during power downs. A detailed description of L-DEO's modeling for marine seismic source arrays for species mitigation is provided in Appendix A of NSF's EA. These are the nominal source levels applicable to downward propagation. The effective source levels for horizontal propagation are lower than those for downward propagation because of the directional nature of the sound from the airgun array. Appendix B(3) of NSF's EA discusses the characteristics of the airgun pulses. NMFS refers the reviewers to the IHA application and EA documents for additional information.

Predicted Sound Levels for the Airguns

Tolstoyet al.,(2009) reported results for propagation measurements of pulses from theLangseth's36-airgun, 6,600 in3array in shallow-water (approximately 50 m (164 ft)) and deep-water depths (approximately 1,600 m (5,249 ft)) in the Gulf of Mexico in 2007 and 2008. Results of the Gulf of Mexico calibration study (Tolstoyet al.,2009) showed that radii around the airguns for various received levels varied with water depth and that sound propagation varied with array tow depth.

L-DEO used the results from the Gulf of Mexico study to determine the algorithm for its model that calculates the exclusion zones (EZ) for the 36-airgun array and the single airgun. L-DEO uses these values to designate mitigation zones and to estimate take (described in greater detail in Section VII of L-DEO's application and Section IV of NSF's EA) for marine mammals.

Comparison of the Tolstoyet al.calibration study with L-DEO's model for theLangseth's36-airgun array indicated that the model represents the actual received levels, within the first few kilometers, where the predicted EZs are located. However, the model for deep water (greater than 1,000 m; 3,280 ft) overestimated the received sound levels at a given distance but is still valid for defining exclusion zones at various tow depths. Because the tow depth of the array in the calibration study is less shallow (6 m; 19.7 ft) than the tow depth array in the proposed survey (9 m; 29.5 ft), L-DEO used correction factors for estimating the received levels in deep water during the proposed survey. The correction factors used were the ratios of the 160-,180-, and 190-dB distances from the modeled results for the 6,600 in3airgun array towed at 6 m (19.7 ft) versus 9 m (29.5 ft) from LGL (2008); 1.285, 1.338, and 1.364 respectively. For a single airgun, the tow depth has minimal effect on the maximum near-field output and the shape of the frequency spectrum for the single airgun; thus, the predicted EZs are essentially the same at different tow depths. The L-DEO model does not allow for bottom interactions, and thus is most directly applicable to deep water.

Table 1 summarizes the predicted distances at which sound levels (160- and 180-dB) are expected to be received from the 36-airgun array and a single airgun operating in deep water. To avoid the potential for injury, NMFS (1995, 2000) concluded that cetaceans should not be exposed to pulsed underwater noise at received levels exceeding 180 dB re: 1 μPa. NMFS believes that to avoid the potential for permanent physiological damage (Level A harassment), cetaceans should not be exposed to pulsed underwater noise at received levels exceeding 180 dB re: 1 μPa. The 180-dB level is a shutdown criterion applicable to cetaceans, as specified by NMFS (2000); these levels were used to establish the EZs. NMFS also assumes that cetaceans exposed to levels exceeding 160 dB re: 1 μPa (rms) may experience Level B harassment.

Table 1—Measured (Array) or Predicted (Single Airgun) Distances To Which Sound Levels Greater Than or Equal to 160 and 180 dB re: 1 μPaRmsThat Could Be Received in Deep Water Using a 36-Airgun Array, as Well as a Single Airgun Towed at a Depth of 9 m (29.5 ft) During the Proposed Survey in the Northwest Pacific Ocean, During March-April, 2012[Distances Are Based On Model Results Provided By L-DEO]Source and volumeWater depthPredicted RMS Distances (m)160 dB180 dB190 dBSingle Bolt airgun (40 in3)Deep (>1,000 m)385401236-Airgun Array3,850940400

Appendix A of NSF's EA discusses L-DEO's calculations for the model. NMFS refers the reviewers to L-DEO's application and the NSF's EA for additional information.

Multibeam Echosounder

TheLangsethwill operate a Kongsberg EM 122 MBES concurrently during airgun operations to map characteristics of the ocean floor. The hull-mounted MBES emits brief pulses of sound (also called a ping) (10.5 to 13 kilohertz (kHz)) in a fan-shaped beam that extends downward and to the sides of the ship. The transmitting beamwidth is one or two degrees (°) fore-aft and 150 ° athwartship and the maximum source level is 242 dB re: 1 μPa.

For deep-water operations, each ping consists of eight (in water greater than 1,000 m; 3,280 ft) or four (less than 1,000 m; 3,280 ft) successive, fan-shaped transmissions, from two to 15 milliseconds (ms) in duration and each ensonifying a sector that extends 1 ° fore-aft. Continuous wave pulses increase from two to 15 milliseconds (ms) long in water depths up to 2,600 m (8,530 ft). The MBES uses frequency-modulated chirp pulses up to 100-ms long in water greater than 2,600 m (8,530 ft). The eight successive transmissions span an overall cross-track angular extent of about 150 °, with2-ms gaps between the pulses for successive sectors.

Sub-bottom Profiler

TheLangsethwill also operate a Knudsen Chirp 3260 SBP concurrently during airgun and MBES operations to provide information about the sedimentary features and bottom topography. The SBP is capable of reaching depths of 10,000 m (6.2 mi). The dominant frequency component of the SBP is 3.5 kHz which is directed downward in a 27° cone by a hull-mounted transducer on the vessel. The nominal power output is 10 kilowatts (kW), but the actual maximum radiated power is three kW or 222 dB re: 1 μPa. The ping duration is up to 64 ms with a pulse interval of one second, but a common mode of operation is to broadcast five pulses at 1-s intervals followed by a 5-s pause.

NMFS expects that acoustic stimuli resulting from the proposed operation of the single airgun or the 36-airgun array has the potential to harass marine mammals, incidental to the conduct of the proposed seismic survey. NMFS expects these disturbances to be temporary and result in a temporary modification in behavior and/or low-level physiological effects (Level B harassment only) of small numbers of certain species of marine mammals. NMFS does not expect that the movement of theLangseth,during the conduct of the seismic survey, has the potential to harass marine mammals because of the relatively slow operation speed of the vessel (4.6 kts; 8.5 km/hr; 5.3 mph) during seismic acquisition.

Description of the Marine Mammals in the Area of the Specified Activity

Thirty-four marine mammal species may occur in the Shatsky Rise survey area, including 26 odontocetes (toothed cetaceans), seven mysticetes (baleen whales) and one species of pinniped during March through April. Six of these species are listed as endangered under the Endangered Species Act of 1973 (ESA; 16 U.S.C. 1531et seq.), including the blue (Balaenoptera musculus), fin (Balaenoptera physalus), humpback (Megaptera novaeangliae), north Pacific right (Eubalaena japonica), sei (Balaenoptera borealis), and sperm (Physeter macrocephalus) whales.

Based on available data, the western north Pacific gray whale (Eschrichtius robustus) may have the potential to migrate off of the Pacific coast of Japan (Reillyet al.,2008a), though any occurrence in the survey area would be rare as gray whales are known to prefer nearshore coastal waters. Based on available data, L-DEO does not expect to encounter the western north Pacific gray whale within the proposed study area and does not present analysis for these species. Accordingly, NMFS did not consider this cetacean species in greater detail and the proposed IHA will only address requested take authorizations for the seven mysticetes, 26 odontocetes, and one species of pinniped. The species of marine mammals expected to be most common in the survey area (all delphinids) include the short-beaked common (Delphinus delphis), striped (Stenella coeruleoalba), and Fraser's (Lagenodelphis hosei) dolphins, and Dall's porpoise (Phocoenoides dalli).

Table 2 presents information on the abundance, distribution, and conservation status of the marine mammals that may occur in the proposed survey area March through April, 2012.

Table 2—Habitat, Abundance, and Conservation Status of Marine Mammals That May Occur in or Near the Proposed Seismic Survey Area on the Shatsky Rise in the Northwest Pacific Ocean[See text and Tables 2 and 3 in L-DEO's application and the NSF's EA for further details]SpeciesHabitatAbundance

NMFS refers the reader to Sections III and IV of L-DEO's application for detailed information regarding the abundance and distribution, population status, and life history and behavior of these species and their occurrence in the proposed project area. The application also presents how L-DEO calculated the estimated densities for the marine mammals in the proposed survey area. NMFS has reviewed these data and determined them to be the best available scientific information for the purposes of the proposed IHA.

Potential Effects on Marine Mammals

Acoustic stimuli generated by the operation of the airguns, which introduce sound into the marine environment, may have the potential to cause Level B harassment of marine mammals in the proposed survey area. The effects of sounds from airgun operations might include one or more of the following: tolerance, masking of natural sounds, behavioral disturbance, temporary or permanent impairment, or non-auditory physical or physiological effects (Richardsonet al.,1995; Gordonet al.,2004; Nowaceket al.,2007; Southallet al.,2007).

Permanent hearing impairment, in the unlikely event that it occurred, would constitute injury, but temporary threshold shift (TTS) is not an injury (Southallet al.,2007). Although the possibility cannot be entirely excluded, it is unlikely that the proposed project would result in any cases of temporary or permanent hearing impairment, or any significant non-auditory physical or physiological effects. Based on the available data and studies described here, some behavioral disturbance is expected, but NMFS expects the disturbance to be localized and short-term.

Tolerance

Studies on marine mammals' tolerance to sound in the natural environment are relatively rare. Richardsonet al.(1995) defines tolerance as the occurrence of marine mammals in areas where they are exposed to human activities or manmade noise. In many cases, tolerance develops by the animal habituating to the stimulus (i.e., the gradual waning of responses to a repeated or ongoing stimulus) (Richardson,et al.,1995; Thorpe, 1963), but because of ecological or physiological requirements, many marine animals may need to remain in areas where they are exposed to chronic stimuli (Richardson,et al.,1995).

Numerous studies have shown that pulsed sounds from airguns are often readily detectable in the water at distances of many kilometers. Several studies have shown that marine mammals at distances more than a few kilometers from operating seismic vessels often show no apparent response (see Appendix B(5) in NSF's EA). That is often true even in cases when the pulsed sounds must be readily audible to the animals based on measured received levels and the hearing sensitivity of the marine mammal group. Although various baleen whales and toothed whales, and (less frequently) pinnipeds have been shown to react behaviorally to airgun pulses under some conditions, at other times marine mammals of all three types have shown no overt reactions (Stone 2003; Stone and Tasker 2006; Moulton et al. 2005, 2006a; Weir 2008a for sperm whales), (MacLean and Koski 2005; Bain and Williams 2006 for Dall's porpoises). The relative responsiveness of baleen and toothed whales are quite variable.

Masking of Natural Sounds

The term masking refers to the inability of a subject to recognize the occurrence of an acoustic stimulus as a result of the interference of another acoustic stimulus (Clarket al.,2009). Introduced underwater sound may, through masking, reduce the effective communication distance of a marine mammal species if the frequency of the source is close to that used as a signal by the marine mammal, and if the anthropogenic sound is present for a significant fraction of the time (Richardsonet al.,1995).

NMFS expects the masking effects of pulsed sounds (even from large arrays of airguns) on marine mammal calls and other natural sounds to be limited, although there are very few specific data on this. Because of the intermittent nature and low duty cycle of seismicairgun pulses, animals can emit and receive sounds in the relatively quiet intervals between pulses. However, in some situations, reverberation occurs for much or the entire interval between pulses (e.g.,Simardet al.,2005; Clark and Gagnon, 2006) which could mask calls. Some baleen and toothed whales are known to continue calling in the presence of seismic pulses, and their calls can usually be heard between the seismic pulses (e.g.,Richardsonet al.,1986; McDonaldet al.,1995; Greeneet al.,1999; Nieukirket al.,2004; Smulteaet al.,2004; Holstet al.,2005a,b, 2006; and Dunn and Hernandez, 2009). However, Clark and Gagnon (2006) reported that fin whales in the northeast Pacific Ocean went silent for an extended period starting soon after the onset of a seismic survey in the area. Similarly, there has been one report that sperm whales ceased calling when exposed to pulses from a very distant seismic ship (Bowleset al.,1994). However, more recent studies found that they continued calling in the presence of seismic pulses (Madsenet al.,2002; Tyacket al.,2003; Smulteaet al.,2004; Holstet al.,2006; and Jochenset al.,2008). Dolphins and porpoises commonly are heard calling while airguns are operating (e.g.,Gordonet al.,2004; Smulteaet al.,2004; Holstet al.,2005a, b; and Potteret al.,2007). The sounds important to small odontocetes are predominantly at much higher frequencies than are the dominant components of airgun sounds, thus limiting the potential for masking.

In general, NMFS expects the masking effects of seismic pulses to be minor, given the normally intermittent nature of seismic pulses. Refer to Appendix B(4) of NSF's EA for a more detailed discussion of masking effects on marine mammals.

Behavioral Disturbance

Disturbance includes a variety of effects, including subtle to conspicuous changes in behavior, movement, and displacement. Reactions to sound, if any, depend on species, state of maturity, experience, current activity, reproductive state, time of day, and many other factors (Richardsonet al.,1995; Wartzoket al.,2004; Southallet al.,2007; Weilgart, 2007). If a marine mammal does react briefly to an underwater sound by changing its behavior or moving a small distance, the impacts of the change are unlikely to be significant to the individual, let alone the stock or population. However, if a sound source displaces marine mammals from an important feeding or breeding area for a prolonged period, impacts on individuals and populations could be significant (e.g.,Lusseau and Bejder, 2007; Weilgart, 2007). Given the many uncertainties in predicting the quantity and types of impacts of noise on marine mammals, it is common practice to estimate how many mammals would be present within a particular distance of industrial activities and/or exposed to a particular level of industrial sound. In most cases, this approach likely overestimates the numbers of marine mammals that would be affected in some biologically-important manner.

The sound criteria used to estimate how many marine mammals might be disturbed to some biologically-important degree by a seismic program are based primarily on behavioral observations of a few species. Scientists have conducted detailed studies on humpback, gray, bowhead (Balaena mysticetus), and sperm whales. Less detailed data are available for some other species of baleen whales, small toothed whales, and sea otters (Enhydra lutris), but for many species there are no data on responses to marine seismic surveys.

Baleen Whales—Baleen whales generally tend to avoid operating airguns, but avoidance radii are quite variable (reviewed in Richardsonet al.,1995). Whales are often reported to show no overt reactions to pulses from large arrays of airguns at distances beyond a few kilometers, even though the airgun pulses remain well above ambient noise levels out to much longer distances. However, as reviewed in Appendix B(5) of the NSF's EA, baleen whales exposed to strong noise pulses from airguns often react by deviating from their normal migration route and/or interrupting their feeding and moving away from the area. In the cases of migrating gray and bowhead whales, the observed changes in behavior appeared to be of little or no biological consequence to the animals (Richardsonet al.,1995). They simply avoided the sound source by displacing their migration route to varying degrees, but within the natural boundaries of the migration corridors.

Studies of gray, bowhead, and humpback whales have shown that seismic pulses with received levels of 160 to 170 dB re: 1 μPa seem to cause obvious avoidance behavior in a substantial fraction of the animals exposed (Malmeet al.,1986, 1988; Richardsonet al.,1995). In many areas, seismic pulses from large arrays of airguns diminish to those levels at distances ranging from four to 15 km from the source. A substantial proportion of the baleen whales within those distances may show avoidance or other strong behavioral reactions to the airgun array. Subtle behavioral changes sometimes become evident at somewhat lower received levels, and studies summarized in Appendix B(5) of NSF's EA have shown that some species of baleen whales, notably bowhead and humpback whales, at times show strong avoidance at received levels lower than 160-170 dB re: 1 μPa.

Researchers have studied the responses of humpback whales to seismic surveys during migration, feeding during the summer months, breeding while offshore from Angola, and wintering offshore from Brazil. McCauleyet al.(1998, 2000a) studied the responses of humpback whales off western Australia to a full-scale seismic survey with a 16-airgun array (2,678-in3) and to a single, 20-in3airgun with source level of 227 dB re: 1 µPa (p-p). In the 1998 study, the researchers documented that avoidance reactions began at five to eight km (3.1 to 4.9 mi) from the array, and that those reactions kept most pods approximately three to four km (1.9 to 2.5 mi) from the operating seismic boat. In the 2000 study, McCauleyet al.noted localized displacement during migration of four to five km (2.5 to 3.1 mi) by traveling pods and seven to 12 km (4.3 to 7.5 mi) by more sensitive resting pods of cow-calf pairs. Avoidance distances with respect to the single airgun were smaller but consistent with the results from the full array in terms of the received sound levels. The mean received level for initial avoidance of an approaching airgun was 140 dB re: 1 μPa for humpback pods containing females, and at the mean closest point of approach distance, the received level was 143 dB re: 1 μPa. The initial avoidance response generally occurred at distances of five to eight km (3.1 to 4.9 mi) from the airgun array and two km (1.2 mi) from the single airgun. However, some individual humpback whales, especially males, approached within distances of 100 to 400 m (328 to 1,312 ft), where the maximum received level was 179 dB re: 1 μPa.

Data collected by observers during several seismic surveys in the northwest Atlantic Ocean showed that sighting rates of humpback whales were significantly greater during non-seismic periods compared with periods when a full array was operating (Moulton and Holst, 2010). In addition, humpback whales were more likely to swim away and less likely to swim towards a vessel during seismic versus non-seismic periods (Moulton and Holst, 2010).

Humpback whales on their summer feeding grounds in Frederick Sound and Stephens Passage, Alaska did notexhibit persistent avoidance when exposed to seismic pulses from a 1.64-L (100-in3) airgun (Malmeet al.,1985). Some humpbacks seemed “startled” at received levels of 150 to 169 dB re: 1 μPa. Malmeet al.(1985) concluded that there was no clear evidence of avoidance, despite the possibility of subtle effects, at received levels up to 172 re: 1 μPa.

Other studies have suggested that south Atlantic humpback whales wintering off Brazil may be displaced or even strand upon exposure to seismic surveys (Engelet al.,2004). Although, the evidence for this was circumstantial and subject to alternative explanations (IAGC, 2004). Also, the evidence was not consistent with subsequent results from the same area of Brazil (Parenteet al.,2006), or with direct studies of humpbacks exposed to seismic surveys in other areas and seasons. After allowance for data from subsequent years, there was “no observable direct correlation” between strandings and seismic surveys (IWC, 2007: 236).

There are no data on reactions of right whales to seismic surveys, but results from the closely-related bowhead whale show that their responsiveness can be quite variable depending on their activity (migrating versus feeding). Bowhead whales migrating west across the Alaskan Beaufort Sea in autumn, in particular, are unusually responsive, with substantial avoidance occurring out to distances of 20 to 30 km (12.4 to 18.6 mi) from a medium-sized airgun source at received sound levels of approximately 120 to 130 dB re: 1 μPa (Milleret al.,1999; Richardsonet al.,1999; see Appendix B(5) of NSF's EA). However, more recent research on bowhead whales (Milleret al.,2005; Harriset al.,2007) corroborates earlier evidence that, during the summer feeding season, bowheads are not as sensitive to seismic sources. Nonetheless, subtle but statistically significant changes in surfacing—respiration—dive cycles were evident upon statistical analysis (Richardsonet al.,1986). In the summer, bowheads typically begin to show avoidance reactions at received levels of about 152 to 178 dB re: 1 μPa (Richardsonet al.,1986, 1995; Ljungbladet al.,1988; Milleret al.,2005).

Reactions of migrating and feeding (but not wintering) gray whales to seismic surveys have been studied. Malmeet al.(1986, 1988) studied the responses of feeding eastern Pacific gray whales to pulses from a single 100-in3airgun off St. Lawrence Island in the northern Bering Sea. They estimated, based on small sample sizes, that 50 percent of feeding gray whales stopped feeding at an average received pressure level of 173 dB re: 1 μPa on an (approximate) rms basis, and that 10 percent of feeding whales interrupted feeding at received levels of 163 dB re: 1 µPa. Those findings were generally consistent with the results of experiments conducted on larger numbers of gray whales that were migrating along the California coast (Malmeet al.,1984; Malme and Miles, 1985), and western Pacific gray whales feeding off Sakhalin Island, Russia (Wursiget al.,1999; Gaileyet al.,2007; Johnsonet al.,2007; Yazvenkoet al.,2007a,b), along with data on gray whales off British Columbia (Bain and Williams, 2006).

Various species ofBalaenoptera(blue, sei, fin, and minke whales) have occasionally been seen in areas ensonified by airgun pulses (Stone, 2003; MacLean and Haley, 2004; Stone and Tasker, 2006), and calls from blue and fin whales have been localized in areas with airgun operations (e.g.,McDonaldet al.,1995; Dunn and Hernandez, 2009; Castelloteet al.,2010). Sightings by observers on seismic vessels off the United Kingdom from 1997 to 2000 suggest that, during times of good sightability, sighting rates for mysticetes (mainly fin and sei whales) were similar when large arrays of airguns were shooting vs. silent (Stone, 2003; Stone and Tasker, 2006). However, these whales tended to exhibit localized avoidance, remaining significantly further (on average) from the airgun array during seismic operations compared with non-seismic periods (Stone and Tasker, 2006). Castelloteet al.(2010) also observed localized avoidance by fin whales during seismic airgun events in the western Mediterranean Sea and adjacent Atlantic waters from 2006-2009. They reported that singing fin whales moved away from an operating airgun array for a time period that extended beyond the duration of the airgun activity.

Ship-based monitoring studies of baleen whales (including blue, fin, sei, minke, and whales) in the northwest Atlantic found that overall, this group had lower sighting rates during seismic versus non-seismic periods (Moulton and Holst, 2010). Baleen whales as a group were also seen significantly farther from the vessel during seismic compared with non-seismic periods, and they were more often seen to be swimming away from the operating seismic vessel (Moulton and Holst, 2010). Blue and minke whales were initially sighted significantly farther from the vessel during seismic operations compared to non-seismic periods; the same trend was observed for fin whales (Moulton and Holst, 2010). Minke whales were most often observed to be swimming away from the vessel when seismic operations were underway (Moulton and Holst, 2010).

Data on short-term reactions by cetaceans to impulsive noises are not necessarily indicative of long-term or biologically significant effects. It is not known whether impulsive sounds affect reproductive rate or distribution and habitat use in subsequent days or years. However, gray whales have continued to migrate annually along the west coast of North America with substantial increases in the population over recent years, despite intermittent seismic exploration (and much ship traffic) in that area for decades (Appendix A in Malmeet al.,1984; Richardsonet al.,1995; Allen and Angliss, 2011). The western Pacific gray whale population did not seem affected by a seismic survey in its feeding ground during a previous year (Johnsonet al.,2007). Similarly, bowhead whales have continued to travel to the eastern Beaufort Sea each summer, and their numbers have increased notably, despite seismic exploration in their summer and autumn range for many years (Richardsonet al.,1987; Allen and Agliss, 2011).

Toothed Whales—Little systematic information is available about reactions of toothed whales to noise pulses. Few studies similar to the more extensive baleen whale/seismic pulse work summarized earlier and (in more detail) in Appendix B of NSF's EA have been reported for toothed whales. However, there are recent systematic studies on sperm whales (e.g., Gordonet al.,2006; Madsenet al.,2006; Winsor and Mate, 2006; Jochenset al.,2008; Milleret al.,2009). There is an increasing amount of information about responses of various odontocetes to seismic surveys based on monitoring studies (e.g.,Stone, 2003; Smulteaet al.,2004; Moulton and Miller, 2005; Bain and Williams, 2006; Holstet al.,2006; Stone and Tasker, 2006; Potteret al.,2007; Hauseret al.,2008; Holst and Smultea, 2008; Weir, 2008; Barkasziet al.,2009; Richardsonet al.,2009; Moulton and Holst, 2010).

Seismic operators and protected species observers (PSOs) on seismic vessels regularly see dolphins and other small toothed whales near operating airgun arrays, but in general there is a tendency for most delphinids to show some avoidance of operating seismic vessels (e.g.,Goold, 1996a,b,c; Calambokidis and Osmek, 1998; Stone, 2003; Moulton and Miller, 2005; Holstet al.,2006; Stone and Tasker, 2006; Weir, 2008; Richardsonet al.,2009; Barkasziet al.,2009; Moulton andHolst, 2010). Some dolphins seem to be attracted to the seismic vessel and floats, and some ride the bow wave of the seismic vessel even when large arrays of airguns are firing (e.g.,Moulton and Miller, 2005). Nonetheless, small toothed whales more often tend to head away, or to maintain a somewhat greater distance from the vessel, when a large array of airguns is operating than when it is silent (e.g.,Stone and Tasker, 2006; Weir, 2008; Barryet al.,2010; Moulton and Holst, 2010). In most cases, the avoidance radii for delphinids appear to be small, on the order of one km or less, and some individuals show no apparent avoidance. The beluga whale (Delphinapterus leucas) is a species that (at least at times) shows long-distance avoidance of seismic vessels. Summer aerial surveys conducted in the southeastern Beaufort Sea reported that sighting rates of beluga whales were significantly lower at distances of 10 to 20 km (6.2 to 12.4 mi) from an operating airgun array compared to distances of 20 to 30 km (12.4 to 18.6 mi). Further, PSOs on seismic boats in that area have rarely reported sighting beluga whales (Milleret al.,2005; Harriset al.,2007).